New development: From social impact bonds to impact bonds—an outcomes-based framework

Abstract

IMPACT This article presents a classification of impact bonds (IBs) that has practical implications for practitioners designing IBs. The framework shows how the nature of the targeted outcomes can affect the financial structure of an IB and influence the capacity to design workable business plans for the projects being financed. Given the reconsideration of cost savings in the newer IB models, the authors recommend that public sector managers and policy-makers question the relevance and advantages of IBs over other types of financing.