Jagdeep, a good question. If governments are doing so badly at delivering education, why can we expect them to do any better at regulating education markets? First, I think this is an empirical question, which we should investigate. I'm sure that unregulated markets (which is the current situation) is worse than some regulation, although I agree that regulation may also be subject to political capture. Secondly, regulation may economize on government's scarce resources--managerial capacity--in a way that provision doesn't. It may be easier to write contracts and enforce them than to manage a large labor force of schoolteachers. Also, remember that with markets, parents and students (as "customers") are also plays a role in enforcing accountability.