University lecturers who have been around for a while often lament the incentives that universities have to inflate students' grades, and many claim that grade inflation has been an ongoing phenomenon for decades. As I noted in
this 2017 post, grade inflation has negative implications for students, because it makes it more difficult for the truly excellent students to set themselves apart from students who are merely very good. However, it isn't just universities that have incentives for grade inflation - the student evaluation system creates
incentives for staff to inflate grades too.
However, there are reasons to doubt whether grade inflation is real. High school teaching has improved over time, so perhaps students are coming to university better prepared for university study, and higher grades reflect that better preparation. On the other hand, university teaching has also improved over time, so perhaps students are learning more during their university classes and higher grades genuinely reflect better performance as a result. Finally, as I have noted
in relation to economics, over time cohorts of students have increasingly selected out of 'more difficult' courses and into 'easier' courses. So, improving grades may simply reflect changes towards courses that are more generous in offering higher grades. Untangling these various effects, and whether any grade inflation remains after you control for them, is an empirical research task.
I've just finished reading a few articles on the topic of grade inflation, so I thought I would share them here. In the
first article, by Rey Hernández-Julián (Metropolitan State University of Denver) and Adam Looney (Brookings Institution), published in the journal
Economics of Education Review in 2016 (ungated earlier version
here), the authors use data from Clemson University of:
...over 2.4 million individual grades earned by more than 86,000 students over the course of 40 academic semesters starting in the fall of 1982 and ending in the summer of 2002.
They note that:
Over the sample period, average grades increased 0.32 grade points (from 2.67 to 2.99), similar to increases recorded at other national universities... At the same time, average SAT scores increased by about 34 points (or roughly 9 percentile points on math and 5 percentile points on verbal sections)...
So, while university grades improved over time, so did the SAT scores of the incoming cohorts of students. Moreover, they note that there has been a shift over time in course selection, so that students have increasingly selected into courses that have higher average grades (arguably, those courses that 'grade easier'). Once they decompose the change in grades into its various components, they find that:
...more than half of the increase in average grades from 1982 to 2001 at Clemson University arises because of changes in course choices and improvements in the quality of the student body. The shift to historically easier classes increased average grades by almost 0.1 grade point. Increases in SAT scores and changes in other student characteristics boosted grades by almost another 0.1 grade point. Nevertheless, almost half of the increase in grades is left unexplained by observable characteristics of students and enrollment — a figure that suggests the assignment of higher grades plays a large role in the increase.
In other words, even after controlling for the quality of incoming students and their course choices, grades increased over time, providing some evidence of 'residual' grade inflation. However, this article is silent as to
why they observe this grade inflation, and of course it relates to the experience of just one university in the US.
The
second article I read recently, by Sergey Popov (National Research University, Moscow) and Dan Bernhardt (University of Illinois, Urbana-Champaign), published in the journal
Economic Inquiry in 2013 (ungated earlier version
here), develops a theoretical argument for why we might observe grade inflation over time, and for why grade inflation would be greater at 'higher quality' universities. Their theoretical argument rests on the following:
Firms learn some aspects of a student’s non-academic skills via job interviews, and forecast academic abilities using the information contained in the ability distribution at a student’s university, the university’s grading standard, and the student’s grade...
Universities understand how firms determine job placement and wages, and set grading standards to maximize the total expected wages of their graduates.
The incentives this creates leads to a situation where:
...top universities set softer grading standards: the marginal “A” student at a top university is less able than the marginal “A” student at a lesser university. The intuition for this result devolves from the basic observation that a marginal student at a top school can free ride on the better upper tail of students because firms cannot distinguish “good A” students from “bad A” students. In contrast, lesser schools must compete for better job assignments by raising the average ability of students who receive “A” grades, setting excessively high grading standards.
So, top universities can benefit their students by giving more of them higher grades. It turns out this situation is exacerbated when the number of 'good jobs' is increasing over time. However, Popov and Bernhardt's paper is purely theoretical, and therefore they don't provide any strong empirical analysis to support their theory.
The
third article I read recently, by Geraint Johnes and Kwok Tong Soo (both Lancaster University), published in the journal
The Manchester School (ungated earlier version
here) actually provides evidence
against Popov and Bernhardt's theoretical model. Johnes and Soo look at aggregate data from all UK universities over the period from 2003/04 to 2011/12, and specifically look at the proportion of 'good degrees' (first or upper second class honours degrees) awarded. They use a
stochastic frontier model in order to control for the inefficiency of some universities in producing top graduates - the most efficient universities form the frontier in this analysis. They find little evidence of grade inflation:
The evidence to support the existence of grade inflation is, at best, patchy. The quality of the student intake to universities has typically been rising over this period, and there have been changes in other factors that might reasonably be supposed to affect degree performance too.
In relation to the Popov and Bernhardt theory, they find that:
...although better universities award more good degrees, we find little evidence that different groups of universities exhibit different degrees of grade inflation over time.
However, there is a real limitation of this study relative to Hernández-Julián and Looney study I mentioned first, that identified grade inflation at Clemson University. The first paper controlled for student quality using SAT scores, while the Johnes and Soo paper controlled for student quality using student results in A levels. So, rather than finding no evidence of grade inflation, it would be more correct to say that Johnes and Soo found no evidence of grade inflation at university
to a greater degree than the extent of grade inflation at high school. Because Hernández-Julián and Looney use the results of a standardised test, their analysis isn't subject to the same limitation. So, grade inflation may be real, but in Johnes and Soo's results it is no worse at university than it is at high school.
Overall, these three articles present contrasting views on grade inflation. There is definitely more research required on the extent to which grade inflation is a real phenomenon, and how much of it can be explained by changes in student quality, teaching quality, or course selection by students.
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