The Economic Value of Higher Teacher Quality

This paper is highly readable - very low on jargon. The models used are also fairly simple to understand.  The numbers he comes up with are staggering:

A teacher one standard deviation above the mean effectiveness annually generates marginal gains of over $400,000 in present value of student future earnings with a class size of 20 and proportionately higher with larger class sizes.  

Alternatively, replacing the bottom 5-8 percent of teachers with average teachers could move the U.S. near the top of international math and science rankings with a present value of $100 trillion.

The paper is primarily about merit pay for teachers. He acknowledges defining quality teachers is difficult (master's degrees & experience don't matter), and advocating for merit pay is politically costly.

His conclusion is that paying teachers far more would be economically justified if salaries reflected effectiveness, but without that link, salaries will lag and schools will underperform.

I'd be curious to see why other countries have such better schools. Do they have merit pay or tenure-less positions? Can the cultural values which benefit students be exported?