Grade inflation is back in the news, as the Harvard Crimson reports that the median grade at Harvard is an A-. This is clearly absurd. It reminds me of some of the old Olympics judging where they had a 10 point scale but everyone scored between 9.7 and 9.9. The problem is not necessarily that the mean is skewed, but that there is almost no room left to discriminate between high and low performance.
There is one potential way to combat this, and it was invented by colleges themselves. Consider grading in high school. My kids go to a very tough-grading private school where A's are actually hard to get. The school sends (for Arizona) a fairly high percentage of its students to Ivy and Ivy-level schools, but the school produces someone with a perfect 4.0 only once every four or five years. Compare that to our local public school, that seems to produce dozens of perfect 4.0's every year -- in fact since it adds a point for honors classes, it produces a bunch of 5.0's.
Colleges understand that a 3.7 from Tough-grading High may be better than a 5.0 from We-have-a-great-football-team High. They solve this by demanding that when high schools provide them with a transcript, it also provide them with data on things like the distribution of grades.
Employers should demand something similar from colleges. This is a little harder for employers, since colleges seem to be allowed to legally collude on such issues while employers can get sued over it. But it seems perfectly reasonable that an employer should demand, say, not only the student's grade for each class but also the median and 90th percentile grades given in that same class. This will allow an employer to see how the school performed relative to the rest of the class, which is really what the employer cares about. And schools that have too many situations where the student got an A, the median was an A, and the 90th percentile was an A may get punished over time with less interest from the hiring community.
One way to get this going is for an influential institution to start printing transcripts this way. The right place to start would be a great institution that feels it has held the line more on grade inflation. My alma mater Princeton claims to be in this camp, and I would love to see them take leadership on this (the campus joke at Princeton during the Hepatitis C outbreak there was that at Harvard it would have been Hepatitis A).
Postcript - An alternate grading system from Harvard Business School: When I was at HBS, they did not give A's and B's. We had three grades called category I, II, and III. By rule, the professor gave the top 15% of the class category I, the bottom 10% category III, and everyone else got a category II. I actually thought this was a hell of a system. It discriminated at the top, and provided just enough fear of failure to keep people from slacking.