Abstract
Evidence of grade inflation in U.S. high schools is often misinterpreted due to confusion about how grade inflation is, or should be, defined. This note reduces the confusion by introducing a typology of grade inflation and discussing the implications of each type. We then provide empirical examples of each type of grade inflation using transcript and test-score data from Algebra I classes in North Carolina over a recent ten-year period. Year-specific (static) grade inflation has been, and remains, higher in schools serving relatively disadvantaged student populations; however, differential changes over the past ten years (what we term dynamic grade inflation) have significantly narrowed the socioeconomic gap in static grade inflation.
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