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Development literature suggests that private schools serving the poor are not part of the solution to meeting the Millennium Development Goal (MDG) of universal primary education. The study conducted a census and survey of schools in notified slums of Hyderabad, India, to contribute to the sparse literature on the nature and extent of private schools for the poor. Of 918 schools found, 60% were found to be private unaided (PUA), enrolling about 65% of total enrolment. On a range of indicators, including pupil-teacher ratio, teaching activity, teacher absenteeism, and classroom and school inputs such as blackboards, desks, chairs, toilets and drinking water, PUA (including unrecognised) schools were found to be superior to government schools. Objections to a role for private schools in meeting the MDG target are explored and challenged.

This paper challenges Christopher Winch's arguments against the neo‐liberal critique of state intervention in education. First, the nature of education and its consumers are shown to imply that education can indeed be described as a commodity. Second, even if the prisoner's dilemma does model the provision of education nevertheless self‐interest can bring about a co‐operative, mutually agreeable solution. Third, while democratic states are unlikely to be able to ensure educational equality or equity, even in the form of adequate educational opportunities for all, the evidence and logic of markets suggest that markets will not similarly be handicapped. Thus in each case, it is argued, the neo‐liberal critique of state intervention in education survives largely unscathed.

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