IDEAS home Printed from
   My bibliography  Save this article

Grading Standards and Education Quality


  • Raphael Boleslavsky
  • Christopher Cotton


We consider school competition in a Bayesian persuasion framework. Schools compete to place graduates by investing in education quality and by choosing grading policies. In equilibrium, schools strategically adopt grading policies that do not perfectly reveal graduate ability to evaluators. We compare outcomes when schools grade strategically to outcomes when evaluators perfectly observe graduate ability. With strategic grading, grades are less informative, and evaluators rely less on grades and more on a school's quality when assessing graduates. Consequently, under strategic grading, schools have greater incentive to invest in quality, and this can improve evaluator welfare. (JEL D82, I21, I23)

Suggested Citation

  • Raphael Boleslavsky & Christopher Cotton, 2015. "Grading Standards and Education Quality," American Economic Journal: Microeconomics, American Economic Association, vol. 7(2), pages 248-279, May.
  • Handle: RePEc:aea:aejmic:v:7:y:2015:i:2:p:248-79
    Note: DOI: 10.1257/mic.20130080

    Download full text from publisher

    File URL:
    Download Restriction: no

    File URL:
    Download Restriction: no

    File URL:
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Au, Pak Hung & Kawai, Keiichi, 2020. "Competitive information disclosure by multiple senders," Games and Economic Behavior, Elsevier, vol. 119(C), pages 56-78.
    2. Christopher Cotton & Haresh Gurnani & Raphael Boleslavsky, 2015. "Demonstrations And Price Competition In New Product Release," Working Paper 1347, Economics Department, Queen's University.
    3. Jain, Vasudha, 2018. "Bayesian persuasion with cheap talk," Economics Letters, Elsevier, vol. 170(C), pages 91-95.
    4. Mark Whitmeyer, 2018. "Dynamic Competitive Persuasion," Papers 1811.11664,, revised Mar 2020.
    5. Bruce Carlin & Christopher Cotton & Raphael Boleslavsky, 2017. "Competing For Capital: Auditing And Credibility In Financial Reporting," Working Paper 1377, Economics Department, Queen's University.
    6. Choi, Jay Pil & Mukherjee, Arijit, 2019. "Optimal certification policy, entry, and investment in the presence of public signals," Working Papers 2019-6, Michigan State University, Department of Economics.
    7. Lehr Brandon, 2016. "Information and Inflation: An Analysis of Grading Behavior," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 16(2), pages 755-783, April.
    8. Le Treust, Maƫl & Tomala, Tristan, 2019. "Persuasion with limited communication capacity," Journal of Economic Theory, Elsevier, vol. 184(C).
    9. Raphael Boleslavsky & Christopher Cotton, 2018. "Limited capacity in project selection: competition through evidence production," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 65(2), pages 385-421, March.
    10. Raphael Boleslavsky & Christopher S. Cotton & Haresh Gurnani, 2017. "Demonstrations and Price Competition in New Product Release," Management Science, INFORMS, vol. 63(6), pages 2016-2026, June.
    11. Cheng Li & Christopher Cotton, 2016. "Clueless Politicians," Working Paper 1341, Economics Department, Queen's University.
    12. Oladokun Omojola* & Lanre Amodu & Nelson Okorie & David Imhonopi & Darlynton Yartey & Evaristus Adesina, 2018. "Assessing the One-Lecture-One-Test Learning Model in Undergraduate Journalism Program Using Cohort Design," The Journal of Social Sciences Research, Academic Research Publishing Group, vol. 4(12), pages 591-597, 12-2018.

    More about this item

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejmic:v:7:y:2015:i:2:p:248-79. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael P. Albert). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.