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
It is important to include return-seeking investors and end beneficiaries in the design of Pay-For-Success programs.
Jeffrey Lubell
Director of Housing and Community Initiatives at Abt Associates
The lack of rigorous evidence about the effectiveness of most social programs puts constraints on how widely Pay-For-Success can be implemented
Mark T. Fliegauf
Fellow in Innovative Government at the Berlin-based think tank stiftung neue verantwortung
The important payoff of pay-for-success is that it will encourage governments to spend more money—more wisely—on social programs.
V. Kasturi Rangan
Malcolm P. McNair Professor of
Marketing at Harvard Business
School
Lisa A. Chase
Head writer and editor at Harvard Graduate
School of Design
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.
Read more stories by V. Kasturi Rangan & Lisa A. Chase.
