Earlier quoted context omitted.
I mean... usually those tests check the correctness of answers too, so you're comparing students under the same circumstances, evaluating how much (writing, calculations.... whatever) they're able to do, correctly of course, within an alotted time period. If someone can correctly solve 17 math problems in that time and someone else can do 21, the second one is "better" than the first, since they're both faster and th…
But where is that level of speed distinction important? I just don't know anywhere where being 10% faster translates into much actual real value. If you can write a function in five minutes and it takes this other person 5.5 minutes -- do you really view that as the key difference in ability? Even in time constrained situations, compute/processing speed is almost never the issue.
For example, get 90% on a test, that's applauded and earns a distinction. In a job context, 90% gets you fired. I don't want a worker who produces "90% well soldered boards". I don't want software that runs on "90% of our customers computers". Or a bug in every 10 lines of released code.
A test puts an arbitrary time limit on a task. In the real world time is seldom the goal. Correctness is more important. (Well, the mechanic was going to put all the wheel nuts on, but he ran out of time.)
College tests are largely a test of memory, not knowledge or understanding. "List the 7 layers of OSI in order." In the real world you can just Google it. Testing understanding is much harder to mark though, Testing memory is easy to set, easy to mark.
Some courses are moving away from timed tests, and more towards assignments through the year. That's a better measure (but alas also easier to cheat. )