UNC will institute a new policy to combat grade inflation, beginning in 2012. The plan hinges on qualifying grades based on contextual factors, so transcripts will now contain summary course statistics alongside grades, and a "scheduled point average" will replace the traditional GPA. In other words, an 'A' in a class where 50% of students receive 'A's will now be worth less than an 'A' in a class where 15% of students receive 'A's.
This plan has been in discussion for quite some time. See, for example, this December NY Times article about a UNC sociology professor Andrew Perrin's push for such a system. And Michael Bérubé wrote an op-ed back in 2004 proposing something similar. I am in full support of this plan, and I hope more colleges and universities adopt a comparable scheme.
But there is one thing that I disagree with. Perrin says:
“I don’t think it’s fair to say it punishes or undermines students,” he said.
“For every student that it seems to harm because it shows their high GPA was earned in relatively easy classes, it helps another student whose low GPA was earned in relatively difficult classes.”
This isn't really true. Some students will benefit from this, yes, but if the problem is grade inflation rather than grade inconsistency, more students will suffer than will benefit. That's because the new "contextual" grades will send a clearer signal of a student's ability (or, at least, her performance in classes). This will help strong students, but it is unlikely that they needed the help: they likely had high GPAs under the traditional grade-inflated system. It will hurt mediocre students, who previously benefitted from the extra noise. A clear signal reveals their mediocrity, where the previous noisy signal masked it. A low GPA in difficult classes will become a mediocre GPA, but will still sort those students into a lower tier than the strongest students.
As I understand it, that's the whole point: rewarding good students for their good work. Like Perrin, I don't think of this as "punishing" mediocre students, but as removing rents. In other words, if the system works the way it's intended, it should hurt some students on the job market*. Which means parents are going to complain. Which means the system might not stay intact for very long. Of course, if this sort of practice becomes widely-adopted, then that pressure will go away. So I hope that's what happens. But there are reasons for schools to not participate: a noisy signal is better for the majority of their students than a clear signal would be.
*Unless it raises the status of a UNC degree at any GPA sufficiently high that a "contextual B" at UNC is equivalent to a "likely-inflated A" at UVA, or wherever. But because the 'A' is a noisy signal while the 'B' is a clear signal, I doubt that will happen.
UPDATE: See Phil's thoughts on how he, as a professor at a different university, would respond to this type of system. He likes it, and would change teaching strategies, but the students are likely to be angry.