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Journal of Public Administration Research and Theory, Vol. 8, No. 2: 137-172 (1998)
© 1998 Public Management Research Association

research-article

Consumer Sovereignty and Quasi-Market Failure

David Lowery

University of North Carolina Chapel Hill

This article explores the concept of quasi-market failure in order to develop a coherent and consistent critique of such quasi-market institutions as vouchers, contracting, and the Tiebout model. After discussing the use of consumer sovereignty as a criterion by which to assess failure, three sources of quasi-market failure are examined: failure in quasi-market formation, failure by preference error, and failure by preference substitution. Each is illustrated with examples from the empirical literature. The article concludes with a discussion of the implications of quasi-market failure both for quasi-market and for justifying reliance on the more traditional progressive reform institutions of public-service provision and production.


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