Grade point averages and law school rankings (Michael Simkovic)

One area of disagreement among law schools and between U.S. News and some of the law schools boycotting its rankings turns on whether incoming students’ undergraduate grade point averages (GPAs) should be included in the rankings, and the extent to which they should be weighed.

The case for including grades initially seems similar to the case for including standardized test scores:  Grades are useful (but incomplete) predictors of future academic and job performance.  They are therefore useful to employers, who are important consumers of the rankings.  Employers cannot recruit in person at every law school, so they prioritize a “target rich environment.”  Moreover, students may benefit from “peer effects” if their classmates are strong academic performers. 

But there are serious problems that are unique to grades: Grades are not standardized.   Grades vary by academic institution, by field or major, by individual courses, by class year, and by instructor.  Moreover, because the other students in the class are at varying levels of ability, and students are graded against each other, the relationship between grades and ability depends on the capabilities of the other students in the class.  Even when average grades are the same, some instructors prefer to give a narrower range of grades, while others prefer to give both high and low grades.

One very serious problem with this lack of standardization is that fields of study that tend to have a relatively low value in the labor market—i.e., that tend to produce graduates with lower earning potential and with lower rates of employment—generally attract students by offering higher average grades for fewer hours of homework to students with lower standardized test scores.  For example, at a given institution, a student who would only earn a “C” in Engineering might earn a “B” in Economics and an “A” in Dramatic Arts, but the reverse is generally not true. 

This difference in grading across fields solves problems for colleges and universities.  It is expensive for colleges to recruit qualified faculty to teach courses in areas that are in high demand in the labor market.  This is because potential faculty members are more likely to have attractive outside offers.  Even when faculty members in high-demand fields are hired, their teaching time may still be scarce because of grant-funded research, clinical time, and other non-teaching obligations. 

Colleges and universities do not need to fully match outside compensation because of differences in job quality in academe versus the private sector.  But they do need to pay faculty in certain fields more than faculty in others.  Thus, professors of Engineering and Medicine earn far more than professors of English and Social Work.  Certain fields of study can also be more expensive for universities because of needs for equipment or facilities. 

Universities with tenured faculty may have a specialized workforce that cannot rapidly adjust to changes in employer needs and parallel changes in student demand.  For example, even if the demand for workers who are knowledgeable about theology declines while the demand for workers who are knowledgeable about technology increases, colleges cannot easily retrain their professors of religion to teach electrical engineering. 

Rather than limit access to costlier majors by directly charging higher tuition, universities instead subtly channel students away from costlier fields, and towards those with excess capacity, by tolerating differences in grades across fields.  This results in many students who initially report that they plan to major in a STEM field getting low grades in their STEM classes and then switching to less challenging majors (i.e., those that offer higher grades for less work). 

However, these differences in grading create problems for students.  Students mistakenly assume that they are “bad” at STEM and “good” in the humanities because they get bad grades in the former and good grades in the latter.  Students dramatically underestimate the differences in earnings potential and employment prospects by major, especially students from poorer and less well-educated families.  Fully informed students would be less likely to switch majors.

A law school ranking system that uses raw undergraduate GPA—without adjusting for differences in grades by major or institution—encourages law schools to also use raw GPA in admissions.  This further encourages undergraduates considering going to law school to hunt for institutions and courses that will give them the best chance of earning the highest grades, and to avoid academically challenging themselves or taking risks.

This might be beneficial to students and employers if high-GPA-majors lined up well with those that best prepared students for law school and subsequent employment.  But this is unlikely.

JDs can help students from low-earning, high-GPA majors make up some lost ground.  However, JD total earnings are still typically higher among law graduates with undergraduate majors that lead to higher earnings directly out of college.  This is in spite of the fact that JD admissions at elite law schools are biased against students completing low-GPA majors.

When law school admissions channel applicants away from low-GPA majors—typically those that place a greater emphasis on quantitative skills—law schools can end up with many incoming students with low levels of numeracy and high levels of anxiety about taking law school classes that require math skills or the ability to learn a complex, rules-based system.  This can feed a perception, albeit exaggerated, that many lawyers are incompetent at math and science.  This perception undermines respect for the legal profession and the judiciary.

Raw GPA can also give an unfair advantage to students from wealthier backgrounds.  First, these students may be more able to sacrifice earning potential out of college when selecting a major.  Second, wealthier students may be able to purchase a higher GPA by attending a more expensive private institution that inflates grades to attract students and tuition revenue, rather than a state institution that is less dependent on tuition revenue and less responsive to market pressures.

Though more speculative, discriminating against quantitative fields in admissions could have other negative consequences for both law graduates and society.  It is possible, for example, that STEM- and finance-oriented skills might be more useful for corporate transactional lawyers, and less helpful for litigators. Objectively, according to government data, billable rates for corporate transactional work have grown much faster than billable rates for litigation over the last several decades.  Anecdotally, many corporate clients believe that transactional work facilitates productive collaboration, while litigation is too often coercive and destructive.  It would therefore arguably help law graduates financially, and also help society, to place quantitative undergraduate majors on an even playing field in admissions.

To summarize, grades should probably be used in law school rankings.  But those grades should ideally be adjusted by major and institution, for example based on differences in the distribution of grades across majors and institutions.  This would reduce well-documented biases in grading that cause a disconnect between grades and student ability levels, and that distort students’ choice of undergraduate major.