Why will system cheat: Chicago Public School System and Delhi University Semester Results

Freakonomics  by Steven D. Levitt and Stephen J. Dubner is a popular reading in non-classical economics.  I am reading it now a days and I am feeling something like what I felt while reading Animal Farm.  Levitt presents a case of Chicago Public School System where high-stake test were introduced. Such test resulted in large scale cheating not only from students but also from teachers.  If enough stakes are there then even the very system can cheat against itself.  Last semester exam at University of Delhi has shown it to the world. Stakes were high because it was necessary to show to courts and rest of world that newly imposed semester is such a good system…therefore University itself cheated in the result of examination.  Unusually high marks were given to students and such a cooking of results was done well after papers were checked.

for records here is excerpts from freakonomics : 

The Chicago Public School system embraced high-stakes testing in 1996. Under the new policy, a school with low reading scores would be placed on probation and face the threat of being shut down, its staff to be dismissed or reassigned. The CPS also did away with what is known as social promotion. In the past, only a dramatically inept or difficult student was held back a grade. Now, in order to be promoted, every student in third, sixth, and eighth grade had to manage a minimum score on the standardized, multiple-choice exam known as the Iowa Test of Basic Skills.
Advocates of high-stakes testing argue that it raises the standards of learning and gives students more incentive to study. Also, if the test prevents poor students from advancing without merit, they won’t clog up the higher grades and slow down good students. Opponents, meanwhile, worry that certain students will be unfairly penalized if they don’t happen to test well, and that teachers may concentrate on the test topics at the exclusion of more important lessons.
Schoolchildren, of course, have had incentive to cheat for as long as there have been tests. But high-stakes testing has so radically changed the incentives for teachers that they too now have added reason to cheat. With high-stakes testing, a teacher whose students test poorly can be censured or passed over for a raise or promotion. If the entire school does poorly, federal funding can be withheld; if the school is put on probation, the teacher stands to be fired. High-stakes testing also presents teachers with some positive incentives. If her students do well enough, she might find herself praised, promoted, and even richer: the state of California at one point introduced bonuses of $25,000 for teachers who produced big test-score gains.
And if a teacher were to survey this newly incentivized landscape and consider somehow inflating her students’ scores, she just might be persuaded by one final incentive: teacher cheating is rarely looked for, hardly ever detected, and just about never punished.

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