The Shadow Economy of Effort: Unintended Consequences of Pass/Fail Grading on Medical Students' Clinical Education and Patient Care Skills.

The shift to pass/fail grading in undergraduate medical education was designed to reduce medical students' stress. However, this change has given rise to a "shadow economy of effort," as students move away from traditional didactic and clinical learning to engage in increasing numbers of research, volunteer, and work experiences to enhance their residency applications. These extracurricular efforts to secure a residency position are subphenomena of the hidden curriculum. Medical schools do not officially require all the activities students need to be most competitive for residency selection; therefore, students, as rational actors, participate in the activities they think will most help them succeed.Here, the authors frame residency application and selection as a complex adaptive system (CAS), which self-organizes without centralized control or hierarchical intent. Individuals in a CAS operate in environments marked by volatility, randomness, and uncertainty-all of which are abundant in the residency selection process. Outcomes in such systems, like the development of a shadow economy, are novel, emergent, and cannot always be anticipated. To address these challenges, the authors suggest the need for deep understanding of the system's elements, interrelationships, and dynamics, including feedback loops and emergent properties. Optimizing the results of a CAS requires incentivizing outcomes over activities, ensuring open information flow, and engaging in continuous monitoring and evaluation.The current pass/fail era and resultant shadow economy of effort risk creating a triple harm by devaluing clinical excellence, burning out medical students, and potentially producing superficial or, worse, inauthentic academic and community work. Medical educators must optimize residency application and selection for cooperative outcomes and design incentives to ensure the outputs of medical education align student, institutional, patient, and societal goals. Without a set of predictive "answers," the authors suggest a process of determining actions to advance this ultimate aim and reduce harm.