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    Krlev, Gorgi Mildenberger, Georg and Anheier, Helmut K. 2017. Special issue on innovation and societal transformation – what changes when the ‘social’ comes in?. International Review of Applied Economics, Vol. 31, Issue. 6, p. 846.

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Social Impact Bonds: The Role of Private Capital in Outcome-Based Commissioning

  • DANIEL EDMISTON (a1) and ALEX NICHOLLS (a2)
Abstract

Social impact bonds are payment by results contracts that leverage private social investment to cover the up-front expenditure associated with welfare services. The introduction of private principles and actors through outcome-based commissioning has received a great deal of attention in social policy research. However, there has been much less attention given to the introduction of private capital and its relation to more established forms of quasi-marketisation. This paper examines what effect private social investment has on outcome-based commissioning and whether the alternative forms of performance measurement and management, that social impact bonds bring to bear on service operations, demonstrate the capacity to engender: innovation in service delivery; improved social outcomes; future cost savings; and additionality. This paper draws on an in-depth study of four social impact bonds in the UK context, as the welfare regime at the vanguard of this policy development. The findings suggest that the introduction of private capital in outcome-based commissioning has had a number of unique and unintended effects on service providers, operations and outcomes. The paper concludes by considering whether social impact bonds represent a risk or an opportunity for public service reform both in the UK and further afield.

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Copyright
COPYRIGHT: © Cambridge University Press 2017
This is an Open Access article, distributed under the terms of the Creative Commons Attribution licence (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted re-use, distribution, and reproduction in any medium, provided the original work is properly cited.
References
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Journal of Social Policy
  • ISSN: 0047-2794
  • EISSN: 1469-7823
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