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Stress-Testing a Quasi-Market: Unintended Consequences of the Swedish School Voucher System

Bergh, Andreas LU and Wernberg, Joakim LU (2024) In IFN Working Papers 2024(1505).
Abstract
Quasi-markets in the provision of public services are increasingly common but also highly contested. We formulate a conceptual framework based on economic theory to describe how quasi-markets differ from traditional markets in five aspects: 1) revenues, costs, and profits; 2) the matching of supply and demand; 3) competition; 4) structural change; and 5) rent-seeking. Using the assumption of profit-maximizing actors, we provide a stress test of quasi-market design and highlight how these differences affect incentives and expected outcomes. Applying the framework to the Swedish school voucher system, we show how design decisions have generated unintended consequences that are detrimental to service quality and run counter to policy goals.
Please use this url to cite or link to this publication:
author
and
organization
publishing date
type
Working paper/Preprint
publication status
published
subject
keywords
Quasi-Markets, School vouchers, Market structure, Public administration, D47, H52, H83
in
IFN Working Papers
volume
2024
issue
1505
publisher
IFN Working Paper series
language
English
LU publication?
yes
id
2ca3f72b-7b94-4844-af01-bd27727afe6f
alternative location
https://www.ifn.se/en/publications/working-papers/2024/1505/
date added to LUP
2025-04-26 11:27:39
date last changed
2025-04-28 10:58:10
@misc{2ca3f72b-7b94-4844-af01-bd27727afe6f,
  abstract     = {{Quasi-markets in the provision of public services are increasingly common but also highly contested. We formulate a conceptual framework based on economic theory to describe how quasi-markets differ from traditional markets in five aspects: 1) revenues, costs, and profits; 2) the matching of supply and demand; 3) competition; 4) structural change; and 5) rent-seeking. Using the assumption of profit-maximizing actors, we provide a stress test of quasi-market design and highlight how these differences affect incentives and expected outcomes. Applying the framework to the Swedish school voucher system, we show how design decisions have generated unintended consequences that are detrimental to service quality and run counter to policy goals.}},
  author       = {{Bergh, Andreas and Wernberg, Joakim}},
  keywords     = {{Quasi-Markets; School vouchers; Market structure; Public administration; D47; H52; H83}},
  language     = {{eng}},
  month        = {{11}},
  note         = {{Working Paper}},
  number       = {{1505}},
  publisher    = {{IFN Working Paper series}},
  series       = {{IFN Working Papers}},
  title        = {{Stress-Testing a Quasi-Market: Unintended Consequences of the Swedish School Voucher System}},
  url          = {{https://www.ifn.se/en/publications/working-papers/2024/1505/}},
  volume       = {{2024}},
  year         = {{2024}},
}