No, I'm not invoking the b.s. idea that other professors use. ("You'll end up spending more energy trying to cheat than you would if you studied." I sincerely doubt it, or else we would not have to monitor against cheating.) Rather I'm thinking about a scheme that might increase the number of students with retention of the knowledge. Robert Frank has often decried the inability of former econ students to answer econ questions any more accurately than someone who has never taken a course. So if my intention is solely to increase the number of students retaining long-term economic knowledge, could I institutionalize cheating in a manner that would accomplish this?
Suppose I tell the students that during exams they are allowed to copy the answers of whoever they sit next to, provided they have the permission of the student they are copying from. In most classrooms, a copier would be able to sit on either side of a test-taker, so you would have a 2-1 ratio of copiers to test-takers. Now, instead of appealing to the lower ability students I target the content of the course to a higher level of difficulty and I test more frequently (maybe 4 or 5 per semester). The good students would then sell the rights to copying their exams, and would have a strong incentive to continuously do well in the course. I would provide credible enforcement of contracts. I would expect then, that 1 out of 3 students would develop a superior command of economic principles, while the other 2 would have forgotten them anyway within a few months of the course.
So, tell me where I go wrong in my logic, or what corrections would be needed to make this system work. No need to point out that the University would never allow this, as it undermines their principal reason for existing -- to signal productivity.