Information Issues, Higher Education Markets

  • Maarja BeerkensEmail author
Living reference work entry



Market failure due to imperfect information on quality and price

Over the last few decades, many countries have introduced market mechanisms to coordinate their higher education sector. Universities are increasingly dependent on tuition fees paid by students or on government funding linked to student numbers and other output indicators (see Barlett, “Quasi-Markets in Higher Education,” in this volume). Market as a coordination instrument relies on the idea that competition creates effective incentives for organizations to improve quality and to contain costs for their services. Markets, however, can deliver these benefits only under certain circumstances, and perfect informationabout price and quality is one of the key prerequisites. Competition can promote cost-effective and high-quality education if universities indeed compete based on quality and price. Both of these aspects, however, have proven...

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Copyright information

© Springer Science+Business Media Dordrecht 2018

Authors and Affiliations

  1. 1.Faculty of Governance and Global AffairsLeiden UniversityHagueNetherlands