Grade inflation and enrollment-based budgeting

Forum Post

We are concerned with the issue of grade inflation at WSU. With help from staff at Institutional Research, we constructed this graph (https://s3.wp.wsu.edu/uploads/sites/908/2024/10/WSU-grade-inflation.png) to show how average GPA has been rising over the past decade at WSU. Although grades spiked considerably during the online-teaching era of COVID, they quickly reverted to what appears to be a clear upward trend. In 2023, the average undergraduate GPA was 3.21; in 2012, it was 3.03. This figure (https://s3.wp.wsu.edu/uploads/sites/908/2024/10/WSU-grade-inflation-by-level.png) shows grade inflation by undergraduate course level; although average grades tend to be higher in upper division courses, the increase in average grades seems to be driven mainly by 100- and 200-level courses.

This trend mirrors one found in other colleges and universities around the country, an issue which has received media attention recently. The issue is a very complicated one to unpack. Changes in enrollment standards and academic preparation in high school are both possible contributing factors. WSU graduates also compete in the job market with graduates from other universities; universities known for having stricter grade policies and lower average GPAs may attract fewer applications if students think the signal of lower relative GPA will hurt their employability.

We also suspect an internal financial motivation. Under enrollment-based budgeting, resources are explicitly tied to enrollments. If students respond to higher grades in certain classes by enrolling in them in larger numbers (a finding of several recent academic papers on this topic), departments may encourage—implicitly or explicitly—instructors to raise grades.

With the data we obtained from WSU IR, we examined the relationship between total current enrollment in an academic department’s offered courses (all levels) in a given year and the average GPA that was given to students in that department’s courses in the prior year. By “enrollment,” we mean the number of grades assigned at the end of the semester, or “student courses taken”. [If we multiplied this by credit hours for each course, it would be SCH]. We used “fixed” effects to control for the academic department and academic year. Although one should not interpret our analysis as causal, it suggests that the financial incentives of EBB could be contributing to grade inflation. Increasing average GPA by 0.1-point in the prior year is associated with an increase in enrollment of about 147 student-courses, or ~ 5% of the mean enrollment across departments.

Social scientists use game theory to describe how people behave and interact according to the strategic incentives they face. This grade inflation problem might well fit the mold of the well-known “prisoner’s dilemma”. Like the two prisoners whose private incentives encourage each to rat out the other (and guarantee prison time for both rather than each walking free), it is in each department’s own financial interests under EBB to make their courses easier than the “competition” to attract students into their courses. This might be particularly true in the 100- and 200-level UCORE classes. Each reacts to the others’ grade inflation by lowering their standards further still.

But a scenario where all WSU students, no matter their effort or ability, graduate with a 3.95 GPA seems unlikely to be a good one for the university as a whole. For one thing, academic evidence (and common sense) shows that tougher grading schemes increase student effort and achievement in the classroom: students learn less in our courses when they know that very few low grades will be given at the end of the semester. In an era of universal grade inflation, the GPA will also lose its informativeness for employers. They may resort to more bespoke testing of their prospective employees, lowering the value overall of attending college. Why spend four years in college if you can just study for Google’s “entrance” exam? High-prestige universities will rely on their reputation value, but mid-tier public universities may wish to instead develop reputations for rigor as a signal to employers.

Finally, research suggests that this problem is felt more acutely by contract teaching faculty. Faculty, particularly females, with contract uncertainty (temporary appointments or tenure-track without tenure) have been shown to give higher grades than tenured faculty in the same courses, perhaps because they recognize the effects of grades given on enrollments and instructor ratings, which are likely more critical to their contract renewal.

We believe that this merits study and discussion by the Faculty Senate under its powers to legislate “standards of scholarship” (Section 2(A)3). Although it may seem unrelated to the Senate’s ongoing efforts to engage more on the University’s overall budget model, we suggest that the issues are inter-related.

-Ben Cowan and Joe Cook, Professors, School of Economic Sciences

Response

The Faculty Senate Executive Officers have been notified of this forum post and will respond back once more information becomes available.

Comment

Comments

4 comments on "Grade inflation and enrollment-based budgeting"
  1. I’d like to see the research to back up this claim:

    “Finally, research suggests that this problem is felt more acutely by contract teaching faculty. Faculty, particularly females, with contract uncertainty (temporary appointments or tenure-track without tenure) have been shown to give higher grades than tenured faculty in the same courses, perhaps because they recognize the effects of grades given on enrollments and instructor ratings, which are likely more critical to their contract renewal.”

    Any member of the contingent faculty may feel the compunction to be careful of upsetting students. Show me the data to say that it is limited to women.

  2. The concern has been forwarded to the Faculty Senate’s Academic Affairs Committee and the chair has confirmed that it is in their agenda for further discussion this week.

  3. Dine – thanks for the comment (and apologies I didn’t see your response until today). We certainly don’t want to minimize the potential for contract uncertainty to affect the pressure for any faculty member – male or female – to award higher grades to students. There is not a wealth of research here, but there is some suggestion of differential effects by gender. The two papers we cite are:

    Sovero, Veronica, and Amanda L. Griffith. “More A’s and I get to stay? How grading influences employment outcomes for contingent faculty.” Education Economics (2024): 1-16.
    https://www.tandfonline.com/doi/abs/10.1080/09645292.2024.2310131

    Griffith, Amanda L., and Veronica Sovero. “Under pressure: how faculty gender and contract uncertainty impact students’ grades.” Economics of Education Review 83 (2021): 102126.
    https://www.sciencedirect.com/science/article/pii/S0272775721000455

    The first shows how contingent faculty who award higher grades are more likely to receive repeat course assignments in the future. The second shows that this effect seems to dominated by female contingent faculty. From the abstract:

    “Our results indicate that students receive higher grades when their class is taught by a female instructor with more job uncertainty than if the class were taught by a tenured female faculty member…However, for students taking classes with male instructors, there is no significant difference across instructor rank in grades received.”

    -JC

  4. I’m writing on this thread 8 months later (Aug 2025), but in case anyone finds their way here later, I wanted to point to a new article that came out in the Atlantic on grade inflation at Harvard.

    https://www.theatlantic.com/ideas/archive/2025/08/harvard-college-grade-inflation/684021/

    Because students (at Harvard!) all know that they will get an A no matter what, many (most?) de-prioritize doing readings or attending classes – in other words, learning from professors and each other – and instead focus their time on consulting clubs, interview prep and other extracurriculars that they feel are now more important in getting the jobs they want (since grades no longer send any signal). The renowned psychologist Steven Pinker (!) reports that he has needed to hand out more and more A’s in his large lecture class or else enrollment drops. This is just the type of financial incentive and prisoner’s dilemma problem that Ben and I outlined in our post.

    Although some of the context will differ between WSU and Harvard, I continue to feel this is an issue that WSU should be pro-active in addressing rather than simply following what others are doing.

    -Joe Cook

Leave a Reply to Tracy A Klein Cancel reply

Your email address will not be published. Required fields are marked *