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January 14, 2006

Economic Idiot Award VI

Step forward please Ms. Russell:

...done just what markets do: polarise schools into the best and the worst,

I’ll agree that schools are indeed polarised in this manner but that isn’t a result of markets and that isn’t what markets do. Markets are simply a mechanism for the distribution of resources to those who value them most highly. A proper market in schools would reduce the polarisation between rich and poor (and might increase it between those parents who care and those who do not).

January 14, 2006 in Economic Idiot Award | Permalink


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Tim, I think you overgeneralise when you suggest that distribution of resources to those who value them most is not polarising. It certainly could lead to polarised outcomes. One example is a market for organ donation - highly polarised between those who can afford (get) organs and those who can't and don't. The problem - the nature of the supply side.

I don't like to reference books usually - seems pretentious, but here I think I can justify it .

Jon Elster covered a lot of this kind of stuff in his book 'local justice'. Also calabresi and bobbit in their book 'tragic choices'. Also - Frank and Cook's 'winner take all markets' is very good on how some markets are markets for 'positional competition' and as such may well be polarising. An example is the superstar phenomenon.

The issue of to what extent markets for education is of course, highly debatable, so I'm not necessarily taking issue with your argument that vouchers may be a good thing.

Posted by: rjw | Jan 14, 2006 11:00:15 PM

sorry - garbled that - meant to say that the issue of to what extent markets for education are positional markets is, of course highly debatable

Posted by: rjw | Jan 14, 2006 11:02:42 PM