Pay-for-success contracts, also known as social impact bonds, have been widely touted as a clever way to fill the funding gap plaguing social programs by attracting a tranche of the trillions of dollars in private return-seeking capital. Although that scenario is not likely, the pay-for-success model will have a positive impact, just not in the way that many proponents think.
Responses
George Overholser Cofounder and CEO of Third Sector Capital Partners
George Overholser Cofounder and CEO of Third Sector Capital Partners
George Overholser Cofounder and CEO of Third Sector Capital Partners
It is important to include return-seeking investors and end beneficiaries in the design of Pay-For-Success programs.
George Overholser Cofounder and CEO of Third Sector Capital Partners
The lack of rigorous evidence about the effectiveness of most social programs puts constraints on how widely Pay-For-Success can be implemented
George Overholser Cofounder and CEO of Third Sector Capital Partners
The important payoff of pay-for-success is that it will encourage governments to spend more money—more wisely—on social programs.
George Overholser Cofounder and CEO of Third Sector Capital Partners
Last Word: V. Kasturi Rangan and Lisa A. Chase respond to the eight people who commented on their article examining the pay-for-success model.
Rangan, V. K., & Chase, L. A. (2015). The Payoff of Pay-for-Success. Stanford Social Innovation Review, 13(4), 28–38. https://doi.org/10.48558/RDHQ-5W31
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