Markets in Education

In the last three decennia, many governments have introduced market mechanisms in education. Theyhave done so by enhancing parental choice and encouraging school competition, through policies likeabolishing catchment areas, creating voucher programmes and setting up charter schools. These marketmechanisms have given rise to fierce debates in both political and scientific circles. However, most priorreviews of research literature in this area have concluded that the effects of market mechanisms ineducation are small, if they are found at all. This review tries to answer the question why that is the case,by analysing the causal pathways that link market mechanisms to educational outcomes and by reviewingthe empirical evidence for each step along those causal pathways. The findings of this review point to theneed for a nuanced and qualified discussion about market mechanisms in education. What marketmechanisms mean in actual practice strongly depends on (local) contexts, while the impact of marketmechanisms is related to other policies impacting on parental choice behaviour as well as actions taken byschools.