The starting point of the project is the perception that during the last decades there have prevailed two strong tendencies in educational politics: On the one hand the ever-increasing importance of institutionalized education to produce knowledge and skills needed in knowledge intensive competitive economies and on the other hand the downsizing of the public sector in the society and severe austerity measures. This paradoxical situation and its effects to the future of schools and other pedagogical institutions will be analyzed as a conflictual relationship between three main discourses: economic discipline (austerity politics), social justice (equity problems) and pedagogical traditions. We try to deepen the understanding of what kind of trends and options are connected with the development of these points of view and how the educational practice is adapting to them. Our hypotheses suppose that the central principles of the theory of pedagogical action: the educability, summon for autonomous action, contextuality and open future have become problematized and substituted by unjustified belief in the self-regulation of the student on the one hand and immediate influence of business and industry to the schools on the other hand. The research is multidisciplinary utilizing, among others, the approaches of the science of education, philosophy, economics and semiotics. The research data consists mainly of theoretical literature, political documents, results of earlier studies and also empirical interview and experimental data. The project will produce, in addition to reports of intermediate results in conferences and journal articles, as an end product an edited book contributed by the researchers and collaborators. The aim of the project is to produce new guidelines to politicians for better decisions in economic and educational policies and to educational practitioners for better pedagogical measures and programs.