Do Swedish upper Secondary Schools Compete through Grade Inflation?

Sammanfattning: This paper studies the relationship between school competition and grade inflation in Swedish upper secondary schooling. It contributes to the literature by introducing a new measure of grade inflation not previously used in relation to competition, as well as a new measure of school competition. The results indicate that competition does not reliably explain grade inflation but that there are large differences in grade inflation between public and non-public schools and between for-profit and non-profit schools. The differences remain even when controlling for competitive environment.