Eugene Volokh defends grading on the curve I mostly agree. I do it myself.
But curving the grades has a major disadvantage Eugene doesn’t discuss: it discourages cooperation among students. In practice, no matter how explicit the syllabus is, grading policies are sufficiently opaque to students that the perverse incentive effect may not be very great. But it’s there. Any student who helps another student learn is moving the curve in what is, from his perspective, the wrong direction.
I don’t go as far as Mike O’Hare does in thinking that the classroom setting should reflect the real-world setting. But surely teaching students that achievement is purely competitive, and competitive at the individual level, ill prepares them for most workplaces, to say nothing of voluntary organizations and households.
There’s a famous experiment in breeding hens to be raised in cages of six to nine hens each. Plan A takes from each cage the hen that produces the most eggs, and breeds the next generation from those hens. Plan B takes from all the cages the cage that produces the most eggs, and breeds the next generation entirely from that cage. Within a few generations, Plan A breeds scrawny, nasty-tempered hens that specialize in breaking one another’s eggs: the avian analogues of pre-meds. Plan B breeds plump, placid, and highly productive hens, and lots and lots of eggs.
Grading on the curve is analogous to Plan A.
Of course that’s a metaphor, not an argument: incentives aren’t fully analogous to selection pressures. But using a grading structure with perverse incentives built in seems like both a bad idea in itself and a bad example to set for students who will, if they wind up running anything, face the problem of how to design a reward system.