Another month, another rationality quotes thread. The rules are:
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The fact that few employers request transcripts and fewer distinguish between "barely passing" and "summa cum laude" (maybe apart from recent graduates?) seems like pretty strong evidence about caring about grading corruption. You really need to corrupt your school's degree award process (like a diploma mill) before anyone will care about it.
Also, as Old_Gold suggests, if you count grade inflation as corruption of grading, empirically this incentive wasn't strong enough. We also note that across-the-board corruption of this type undermines incentives. If someone comes up with a better signal, the entire institution of universities would collapse, but most people have seemed to accept rampant grade inflation with a shrug rather than mostly ignoring degrees. It may eventually collapse, but on a time scale where it seems difficult to believe "this was due to grade inflation starting 50 years ago."
Yes, that's true. The incentive works on grading corruption at the level of "this guy should have scored 10%, how did he pass?". It has no effect on grading corruption on the level of "this guy should have barely passed, how did he get a distinction?"