ABSTRACT
This chapter examines three questions: How much should teachers be paid on average? Should local providers be allowed to vary teachers' pay? How should teachers' work be governed in order to secure good value for money? Governments influenced by the public choice critique have tried to improve value for money by changing the conditions of supply. Therefore, anyone who believes that governments will always waste money will believe that government has spent too much on education. Conversely, governments which base their appeal to voters on low taxation will have a strong political incentive to spend insufficiently on education. The chosen combination of provision, commissioning, regulation and information will frame policy which will be worked out through interactions among hierarchical, market and network governance. The choices a government makes about regulation and information interact with choices about providing and commissioning and these interactions feed into the implementation of education policy through the combination of governance mechanisms.
