But their findings are surprising and support the argument against increasing grades.
Students who experienced more lenient grading were less likely to pass subsequent courses, had lower scores on subsequent exams, were less likely to graduate from high school and enroll in college, and earned significantly less years later.
The economic cost is not small. Denning estimates that when a teacher gets substantially higher grades (0.2 or more points on a 4-point scale, the difference between a B and almost a B+), a student in that class loses about $160,000 in lifetime earnings, measured in today’s dollars.
That is the effect of a single teacher, in a single year. If a student encounters multiple teachers who inflate their grades, the losses accumulate.
Evidence from two very different places
The researchers examined students in two settings: Los Angeles and Maryland.
The Los Angeles Unified School District provided data on nearly one million high school students between 2004 and 2013, a period when graduation rates hovered just above 50 percent. The student population was more than 70 percent Hispanic and failing grades were common.
The Maryland data followed about 250,000 high school students between 2013 and 2023. Graduation rates were over 90 percent and the student population was more mixed race. The Maryland data allowed researchers to track college enrollment, employment and income, while the Los Angeles data ended with high school.
Despite these differences, the pattern was the same.
Students taught by lenient evaluators (defined as teachers who gave higher grades than expected based on standardized test scores and students’ prior performance) performed worse later in high school. In Maryland, where there was data on college and workplace, these students were also less likely to attend college or be employed, and they earned less.
Seeing the same pattern in two very different systems reinforces the argument that this is not a coincidence of one district or one political regime.
When indulgence helps and when it doesn’t
The study makes a crucial distinction. Teachers who still kept A’s challenging but only made it easier to pass (turning failures into low passing grades) helped more students graduate from high school, particularly those at risk of dropping out of school. That short-term benefit is real. For some students, passing Algebra I instead of failing it can keep them on track to graduate and possibly enroll in community college.
But the benefit ends there. Those students show no long-term improvements in terms of college degree completion or earnings. Forbearance helps them overcome an obstacle, but it doesn’t help them develop the skills they need later.
In contrast, general grade inflation (teachers raising grades across the board from Cs to Bs to As) shows no benefit and hurts students’ chances of future success.
Why do good intentions backfire?
The study cannot directly explain why higher grades lead to worse outcomes. But the mechanism is not difficult to imagine. In a class with a lenient student, a smart student may quickly realize that he or she does not need to study hard or complete all of the homework. If you get a B in Algebra I without learning how to factor or solve quadratic equations, the knowledge gaps will follow you to geometry and beyond. He may be able to manage again. Over time, the deficit worsens. Trust is eroded. Learning slows down. In college or the workplace, the consequences manifest themselves in lower skills and lower wages.
As Denning put it during the presentation, there appears to be a “causal chain” of harm, even if you can’t directly measure how much less students study or how far behind they have fallen.
Don’t be quick to blame the teachers
Improving grades is not always a decision of an individual instructor. TO survey 2025 documents the frustrations of many teachers who inflate grades and say they feel pressured by administrators to comply with “fair grading” policies that prohibit zeros, allow unlimited retakes and eliminate penalties for late work.
Forgiving students are not bad teachers. The study finds that they are often better at improving non-cognitive skills. Your students are better behaved, more cooperative, and less likely to be suspended. Still, in this study, that doesn’t translate into better life outcomes, as one might expect.
Stricter testers tend to be better at improving test scores in math, reading, and other academic subjects. Despite that correlation, that doesn’t mean that all difficult students are good teachers. Some are not.
This is a preliminary investigation. More studies are needed to understand whether college grade inflation has similar labor costs. And there are questions about whether boys react differently than girls to inflated grades.
Teachers struggle to get students engaged in learning, which is full of setbacks, frustration, and boring repetition. Perhaps low grades do not inspire students to do this hard work. But this preliminary evidence suggests that inflated ratings aren’t doing them any favors.
Contact the staff writer Jill Barshay at 212-678-3595, jillbarshay.35 on Signal, or barshay@hechingerreport.org.
