Accessing Social Value from Profit-Oriented Public–Private Partnership

Abstract

This study demonstrates how to access social value from profit-oriented public–private partnership. The author examines social impact bonds (SIBs) as a tool for financing public–private investments. Using the database of worldwide SIB-financed projects, this study develops an incentive-compatible mechanism of profit write-off for social purposes (e.g. medical services for uninsured constituencies). It presents the feasibility space of this mechanism given entrepreneur, institutional boundaries. The mechanism resurfaces public–private partnerships as a vehicle where profitability and social goals can be met.

Keywords:

• Social impact bonds
• Public–private partnership
• profit
• social outcomes

Subject classification codes:

• JEL: I38
• L32
• L38
• M21
• P43

Disclosure Statement

No potential competing interest was reported by the autho(r).