Tim Taylor (see here) points us to research by Stuart Rojstaczer and Christopher Healy regarding grade inflation (see the following graph).
Rojstaczer and Healy state:
Even if grades were to instantly and uniformly stop rising, colleges and
universities are, as a result of five decades of mostly rising grades,
already grading in a way that is well divorced from actual student
performance, and not just in an average nationwide sense.
Taylor notes (see here)
Like so many other bad habits, grade inflation is lots of fun until
someone gets hurt. Students are happy with higher grades. Faculty are
happy not quarreling with students about grades...
To me, the real and practical problem of grade inflation is that it
causes students to alter their choices, away from fields with tougher
grading, like the sciences and economics, and toward fields with easier
grading.