The Long-term Consequences of Teacher Discretion in Grading of High-stakes Tests

Rebecca Diamond, Petra Persson

NBER Working Paper No. 22207
Issued in April 2016, Revised in June 2016
NBER Program(s):ED, LS, PE

We examine the long-term consequences of teacher discretion in grading of high-stakes tests. Bunching in Swedish math test score distributions reveal that teachers inflate students who have “a bad test day,” but do not to discriminate based on immigrant status or gender. By developing a new estimator, we show that receiving a higher grade leads to far-reaching educational and earnings benefits. Because grades do not directly raise human capital, these results emphasize that grades can signal to students and teachers within the educational system, and suggest important dynamic complementarities between students’ effort and their perception of their own ability.

You may purchase this paper on-line in .pdf format from ($5) for electronic delivery.

Access to NBER Papers

You are eligible for a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.


Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w22207

Users who downloaded this paper also downloaded* these:
Dee, Dobbie, Jacob, and Rockoff w22165 The Causes and Consequences of Test Score Manipulation: Evidence from the New York Regents Examinations
Fryer w22205 The 'Pupil' Factory: Specialization and the Production of Human Capital in Schools
Fletcher and Wolfe w22168 The Importance of Family Income in the Formation and Evolution of Non-Cognitive Skills in Childhood
Macartney, McMillan, and Petronijevic w21835 Incentive Design in Education: An Empirical Analysis
Fryer w22130 The Production of Human Capital in Developed Countries: Evidence from 196 Randomized Field Experiments
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us