Equilibrium Grade Inflation with Implications for Female Interest in Stem Majors
47 Pages Posted: 16 Dec 2019 Last revised: 25 Jul 2021
Date Written: December 2019
Substantial earnings differences exist across majors with the majors that pay well also having lower grades and higher workloads. We show that the harsher grading policies in STEM courses disproportionately affect women. To show this, we estimate a model of student demand courses and optimal effort choices of students conditional on the chosen courses. Instructor grading policies are treated as equilibrium objects that in part depend on student demand for courses. Restrictions on grading policies that equalize average grades across classes helps to close the STEM gender gap as well as increasing overall enrollment in STEM classes.
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