The Consequences of Letter Grades for Labor Market Outcomes and Student Behavior

The use of letter grades to assess academic performance can impact future income prospects.
Individuals who achieve higher grades in a particular course can anticipate a rise in their post-graduation monthly earnings.
Conversely, students who obtain lower grades often opt for less challenging classes and subsequently earn lower grades in subsequent semesters.

Image courtesy of interviewee. November 11, 2023

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