DEEPEN - Developing Effective Private Education Nigeria | M4P
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The central features of a market systems approach are built around analysis and action:

  • Understanding the structures, rules and incentives around which the central ‘supply and demand’ core of a market works – and the main reasons (constraints) preventing it from working better for the poor
  • Unblocking the constraints through improving wider systems (in this case: information, rules, access to services) that influence the core, so that the market works better, matching demand and supply
  • Placing emphasis on learning, monitoring and evaluation, to inform further change.

A market systems approach is grounded on principles of ‘do no harm’ and sustainability.  Every proposed intervention considers what impacts – negative and positive – it will likely have and ensures sustainability by asking the key questions of “who does?” and “who pays?” What a market systems approach does not do is provide short term fixes in the form of funds, goods and services that may undermine market systems and do long term damage.

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Why a market systems approach?

In 2011, DFID Nigeria identified the need to intervene in the Lagos private education context and commissioned a scoping study which recommended that any intervention should follow an M4P approach.

This approach was selected on for two reasons: first, M4P-based projects funded by DFID are generating significant evidence of success. For example:

(1)           In Nigeria, the PrOpCom programme, after an initial period following a different course, changed to a market systems approach, reaching 1.26m poor people, generating additional net income of £41m, and creating over 17,000 jobs. According to the project report, “only once PrOpCom started to adopt a rigorous M4P methodology did its effectiveness start to increase”.

(2)          In South Africa, the FinMark Trust contributed to a 7.1m increase (doubling) in the banked population, working with banks, government, and specialised service providers.

(3)          In Bangladesh, the DFID-supported Katalyst project has worked with more than fifty companies, government and other organisations. It has generated 183,000 jobs and $115m in additional income and impacted positively on 1.6m small and medium-sized enterprises (SMEs) and farmers.

Secondly, it makes sense for the Lagos private education market – which has over 15,000 schools. With the emergence of these schools, the ‘rules of the game’ have fundamentally changed. Education can no longer be seen as a public good delivered by the public sector, but rather as a complex pluralist system. In this context, standard development responses will not be appropriate. Thus, a market systems approach was a logical choice.