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The Impact of Grading Standards on Student Achievement, Educational Attainment, and Entry-Level Earnings

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  • Julian R. Betts
  • Jeff Grogger

Abstract

Despite recent theoretical work and proposals from educational reformers, there is little empirical work on the effects of higher grading standards. In this paper we use data from the High School and Beyond survey to estimate the effects of grading standards on student achievement, educational attainment, and entry level earnings. We consider not only how grading standards affect average outcomes but also how they affect the distribution of educational gains by skill level and race/ethnicity. We find that higher standards raise test scores throughout the distribution of achievement, but that the increase is greatest toward the top of the test score distribution. Higher standards have no positive effect on educational attainment, however, and indeed have negative effects on high school graduation among blacks and Hispanics. We suggest a relative performance hypothesis to explain how higher standards may reduce educational attainment even as they increase educational achievement.

Suggested Citation

  • Julian R. Betts & Jeff Grogger, 2000. "The Impact of Grading Standards on Student Achievement, Educational Attainment, and Entry-Level Earnings," NBER Working Papers 7875, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:7875
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    References listed on IDEAS

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    1. Betts, Julian R, 1998. "The Impact of Educational Standards on the Level and Distribution of Earnings," American Economic Review, American Economic Association, vol. 88(1), pages 266-275, March.
    2. Grogger, Jeff, 1996. "School Expenditures and Post-schooling Earnings: Evidence from High School and Beyond," The Review of Economics and Statistics, MIT Press, vol. 78(4), pages 628-637, November.
    3. Henry S. Farber & Robert Gibbons, 1996. "Learning and Wage Dynamics," The Quarterly Journal of Economics, Oxford University Press, vol. 111(4), pages 1007-1047.
    4. Eric A. Hanushek & Lori L. Taylor, 1990. "Alternative Assessments of the Performance of Schools: Measurement of State Variations in Achievement," Journal of Human Resources, University of Wisconsin Press, vol. 25(2), pages 179-201.
    5. Jeff Grogger & Eric Eide, 1995. "Changes in College Skills and the Rise in the College Wage Premium," Journal of Human Resources, University of Wisconsin Press, vol. 30(2), pages 280-310.
    6. Loury, Linda Datcher & Garman, David, 1995. "College Selectivity and Earnings," Journal of Labor Economics, University of Chicago Press, vol. 13(2), pages 289-308, April.
    7. Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, vol. 32(3), pages 385-397, August.
    8. Murnane, Richard J & Willett, John B & Levy, Frank, 1995. "The Growing Importance of Cognitive Skills in Wage Determination," The Review of Economics and Statistics, MIT Press, vol. 77(2), pages 251-266, May.
    9. Costrell, Robert M, 1994. "A Simple Model of Educational Standards," American Economic Review, American Economic Association, vol. 84(4), pages 956-971, September.
    10. Becker, William E. & Rosen, Sherwin, 1992. "The learning effect of assessment and evaluation in high school," Economics of Education Review, Elsevier, vol. 11(2), pages 107-118, June.
    11. Lillard, Dean R. & DeCicca, Philip P., 2001. "Higher standards, more dropouts? Evidence within and across time," Economics of Education Review, Elsevier, vol. 20(5), pages 459-473, October.
    12. Grogger, Jeff, 1996. "Does School Quality Explain the Recent Black/White Wage Trend?," Journal of Labor Economics, University of Chicago Press, vol. 14(2), pages 231-253, April.
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    JEL classification:

    • I2 - Health, Education, and Welfare - - Education

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