An Incentivized Honor System for Grading Preparatory Assignments of Business Games and Cases: Theory and Implementation

Abstract

We present a theory and propose an empirical test of an incentivized honor system for grading preparatory assignments. Under the system, students apply an instructor-supplied rubric to self-scored submissions ex-ante, such that self-scores are delivered before or at the same time as submissions. The students’ self-scores are the students’ grades for their submissions unless the assignment is audited. When an assignment is audited, the instructor scores every submission and applies a veracity incentivized grading formula (VIGF) that includes a reward for veracity and a penalty for self-scores higher than instructor’s scores. From expected-value analysis, we derive fixed VIGF parameters for randomly auditing half of a series of about five assignments. We derive adaptive parameters for auditing a series of about 10 assignments, using the reversed harmonic series to decide on audit frequencies. Manual and computerized implementation mechanics are discussed, and remedies for students gaming the system are explored. We caution on using ex-post self-scoring, whereby students deliver self-scores following their submissions after a duration that allows review of teaching materials and training in scoring, because the interest of instructors in saving time may conflict with the argued pedagogical advantage to students of the ex-post procedure. We end with a suggestion for testing the theory with data.