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Walking the contractual tightrope: a transaction cost economics perspective on social impact bonds |
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| Authors: | Clare FitzGerald Eleanor Carter Ruth Dixon Mara Airoldi |
| Institution: | 1. University of Oxford, Blavatnik School of Government, Government Outcomes Lab, Oxford, UK![ORCID Icon]({"type":"image","src":"/templates/jsp/images/orcid.png"} "ORCID Icon") https://orcid.org/0000-0002-1021-8041;2. University of Oxford, Blavatnik School of Government, Government Outcomes Lab, Oxford, UKhttps://orcid.org/0000-0001-5774-7728;3. University of Oxford, Blavatnik School of Government, Government Outcomes Lab, Oxford, UKhttps://orcid.org/0000-0002-2177-609X;4. University of Oxford, Blavatnik School of Government, Government Outcomes Lab, Oxford, UKhttps://orcid.org/0000-0002-2781-9628 |
| Abstract: | ABSTRACTTransaction cost economics is applied in this paper to social impact bonds to explore how public service commissioners could improve outcomes-based contracts. The authors supply a framework for assessing the quality of outcomes specifications and clarify the trade-off between a robust value case for government and the transaction costs associated with specifying such a deal. Illustrated by two examples, the authors suggest that commissioners aim for a ‘requisite’ contract: one that minimizes opportunism while balancing the costs of developing a more robust outcomes specification. |
| Keywords: | Outcomes-based commissioning payment-by-results public service contracting social impact bonds transaction costs |