The World Bank and other international institutions often promote market-based solutions for implementation of public services. This research examines the set-up, implementation, and results of public-private partnerships and outsourcing, using a World-Bank funded literacy project for women in Senegal as a case study. The case is analyzed from a critical and welfare economics perspective, as well as from a neoliberal view, and shows how the analytical approach conditions the understanding of the project.

The World Bank implements much of its development projects in the belief that the market is more cost-effective than government implementation. In this case, literacy education was not funded by the World Bank until the Senegalese state had formulated a project that fit the Bank's neoliberal policy vision. The requirement of private implementation strategies was a way to impose marked-based solutions that in the end proved to be unreasonable and ineffective.

Analysis of enrollment, success and drop-out rates shows that the project enrolled approximately 180,000 learners, of which only about 44,000 learned to write and read. The literacy courses offered very cheap and very ineffective schooling (whereas the state-implemented primary school system offered much more expensive but also a somewhat more effective education). Literacy education offered in Senegal therefore appears to be poor education for the poorest of the citizens. The literacy providers offered low-quality literacy learning because they wanted to make money from the service delivery, and therefore cut costs. The government and the World Bank failed to correct these negative aspects of the public-private partnership system.

The outsourcing affected civil society in Senegal. The project created and structured civil society by helping to establish women's associations in the villages. However, outsourcing also had a negative effect, since provider associations increasingly became businesses that were dependent on politicians, and corrupt practices multiplied. In order to improve literacy education in Senegal, it is necessary to acknowledge the inability of the market to solve literacy problems on its own, and to adopt a more balanced distribution of responsibilities between the public and the private sectors.