"Today, we'll have a pop quiz." Back in my days as a traditional teacher, I loved this sentence. There was a sense of power and control, when I surprised my students with some sort of test of knowledge over something we'd recently studied or of a chapter in some boring book I had demanded that they read.
Tests are not much different. Students study information the teacher provides, and they are given a list of questions created by the teacher, based on the information that was delivered. The teacher has all of the control -- one reason that tests masquerade as objective assessments, when they are, in fact, very subjective.
If we are to reform our failing education system, it's time to rethink tests and quizzes. To simplify things, the first step should be to eliminate quizzes entirely, as they serve no educational purpose. As Jerome Bruner wrote, teachers should help students "experience success and failure not as a reward and punishment, but as information (The Act of Discovery, 1961)."
So, let's concentrate on tests. Although project-based assessment is the best way to evaluate learning, tests can provide the information, of which Bruner writes.
The key to making good use of a test is to use it strictly as a diagnostic tool. In fact, the word "test" should be replaced with diagnostic. Students should be taught that a diagnostic tool, especially one that contains multiple choice items, is only part of assessment.
Because tests are unreliable and subjective, the results should never be part of a grade, and they should be used to evaluate which learning outcomes need more attention from the teacher. Rather than looking at test results in terms of individual students, they should be considered holistically. So, if 40 percent of a class misses number 8 on a diagnostic, there is either a problem with the item, or the learning outcome needs to be revisited.
When tests are used in this fashion, strictly as diagnostic tools, they become one useful part of evaluation of learning.
Look for more on this subject at this post on raising test scores.