Monday, August 10, 2015
What We Learned from the Failure of the Rikers Island Social Impact Bond
An experiment using a Social Impact Bond (SIB) to reduce the rate at which juvenile offenders return to jail—so-called “recidivism”—at the troubled Rikers Island prison didn’t work, despite being hailed as a success by some.
The concept of SIBs is for private investors to lend money to governments for the funding of programs that, if successfully delivered, will generate long-term savings. Repayment of upfront funds is triggered when an independent evaluator certifies that programs have achieved the promised results. Proponents argue that SIBs should be used— at no cost to taxpayers—to test to see which innovative ideas can make a dent in intractable social problems....