Every year, parents and guardians of children about to start primary or secondary state schools participate in a market to find their child’s new school. Like markets for any other good or service, there are consumers of education (the pupils) and producers of education (the schools). However, unlike bananas, bricks and banking services, the school a pupil is assigned to and the amount of education consumed is not based on a parent’s (or pupil’s) individual willingness to pay — laws mandate school attendance and make the selling of places in state schools illegal. These laws mean that we cannot use the price mechanism to match pupils with school places and instead we must carefully design a different mechanism to decide who goes where.
the market mechanism, price mechanisms (other than money), market failure, government intervention in markets
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