Does Market Competition Encourage Strategic Action in the Private Education Sector?

Abstract

This article examines whether market forces encourage private education entrepreneurs to strategically outsmart the competition in ways that improve the quality of their programs or service delivery. Based on interviews with eighty private education entrepreneurs, we find that market competition does not inform how they understand their role in the wider education sector or how they made sense of their actions. Instead entrepreneurs tie their program, hiring and customer service decisions to an ideological commitment to students and by defining themselves as educators. Drawing on the sense-making literature, we suggest that this worldview guides their actions more so than the principle of supply and demand. This paper opens the black box of private education organizations, and offers a nuanced addition to mounting research that challenges the connection between market competition and school performance.