Non-market Failures in Higher Education (The case of Bulgaria)

The extent to which the market and government determine the direction, allocation, and use of resources in the economy is a major object of economic choice. This is part of the fundamental debate in economic theory – state or market. The lack of a clear answer is dictated by the debatable nature of the problem, by the absence of an unambiguously correct solution. The presented article is an attempt at a theoretical analysis of externalities in the higher education sector, which is also its object. The author's thesis is that in this sector in Bulgaria the failures of the state are predominant over the failures of the market. Its partial withdrawal will have a positive long-term effect on both the sector and the economy as a whole. After highlighting the non-market failures in the field of higher education in Bulgaria, specific recommendations and opportunities for overcoming them were made.