Currently teachers generally come from the bottom third of university graduates in the US. This is not the same in other countries. Teachers in Europe and Asia are paid more in line with other professionals, like engineers.
The National Center on Education and the Economy proposes that teacher pay should be increased, and be based on merit. If pensions are included, current salaries are actually somewhat competitive. But talented young people prefer money now, and don't know that they would stay in teaching long enough to earn a pension. Thus, pension money could be moved to up front salary and portable 401Ks, with existing teachers having the option of opting in or staying with their pensions.
Both A Nation at Risk and more recently The $100,000 Teacher recommend career ladders for teachers, with the ability to become a master teacher, or mentor to younger teachers, helping with curriculum, etc.
A couple of studies on the effectiveness of higher teacher salaries are Teacher Motivation and The Cost of Underpaying Texas Teachers.