The direct democratic choice of an examination standard, i.e., a performance level required to graduate, is evaluated against a utilitarian welfare function. It is shown that the median preferred standard is inefficiently low if the marginal cost of reaching a higher performance reacts more sensitively to ability for high than for low abilities, and if the right tail of the ability distribution is longer than the left tail. Moreover, a high number of agents who choose not to graduate may imply that the median preferred standard is inefficiently low even if these conditions fail.
I21 - Analysis of Education ; D72 - Economic Models of Political Processes: Rent-Seeking, Elections, Legistures, and Voting Behavior ; I28 - Government Policy