The creation and implementation of Social Impact Bonds

At Discover Society, a group of researchers explain their recent investigations into the formation and implementation of Social Impact Bonds (SIBs), as published more formally in an academic paper for the journal Policy & Politics.

The authors note that the current understanding of SIBs is somewhat polarised, between on the one hand a perception that they are “an innovative public policy tool that allows the state to fund ‘what works’ through a focus on outcomes”, and on the other hand a critique of the outcomes-driven nature of SIBs “because of how it narrows the scope of what can be funded i.e. one can only fund what can be measured and proven.” The researchers have worked to address the void of empirical detail regarding the actual creation and delivery of SIBs:

Our study contributes to research in this area in two important ways. Firstly, it provides one of the first detailed accounts of SIB formation and implementation. Developing this account required a micro-level understanding of decision-making among the main actors involved. Secondly, it shows that the discourses associated with the “work” of setting up a SIB can be in conflict. If such tensions and conflicts are apparent in other SIB programmes then this has serious implications for how those contracts work and potentially the type of care received by beneficiaries.

They also discuss their recent work on the social enterprise sector in Chile, where a number of institutional factors suggest that SIBs, if well implemented, could make a significant difference to service delivery in the country.

The full essay can be read at Discover Society, while the research paper on SIBs — Lowe, Toby, et al. (2018) “The institutional work of creating and implementing Social Impact Bonds.” — is available under open-acess at the journal Policy & Politics.