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The Effect of the Quasi-Market on the Efficiency-Equity Trade-Off in the Secondary School Sector

Britain's education system was radically transformed during the 1990s following the Education Reform Act (1988). The primary objective of these reforms was to raise educational standards through the creation of a quasi-market based upon greater parental choice and the transfer of control over resources from local education authorities to schools. The purpose of this paper is to investigate the effects of the quasi-market on efficiency and equity in the secondary education sector in England during the 1990s. Two primary questions are addressed. Has the quasi-market led to an improvement in efficiency in the secondary education sector? Has the quasi-market had any adverse consequences on the social segregation of pupils between schools? Using data obtained from the Schools' Census and the School Performance Tables, we find strong evidence that the quasi-market has led to a substantial improvement in efficiency (as measured by a school's exam performance and by the productivity of staff) during the 1990s. The same market forces have led to a greater social segregation of pupils between schools.) Copyright 2002 by Blackwell Publishing Ltd and the Board of Trustees of the Bulletin of Economic Research