This report, the second in a series of eight which analyzes the educational personnel system, applies three theories of labor mobility to primary and secondary school teachers. These theories are the economic theory of the human capital model, the institutional theory of internal labor markets, and a probabilistic Markov model. The literature on each of the theories is briefly reviewed, and the substantive notions of the human capital model and the theory of internal labor markets are combined with the Markov model to develop a theory of teacher mobility. Some of the hypothetical implications of the theory of teacher mobility described are that: (a) interdistrict movement of school teachers should depend on both pecuniary and nonpecuniary differences among school districts; (b) teachers who are located in assignments offering relatively low financial rewards should be more likely to leave teaching than those in more attractive assignments; (c) school districts should prefer to hire teachers who have more teaching experience and advanced degrees in education; and (d) relatively experienced teachers should be less mobile than less experienced teachers because they are more likely to be located in an assignment they consider attractive. The consequence of these implications is that the more attractive schools will have faculties with greater experience and educational attainment and that the same will be true of entire school districts. (HMD)