Challenges for European welfare systems. A research agenda on social impact bonds
First, the Social Business Initiative of the European Commission and then the G8 Social Impact Investment Taskforce: these are meaningful indicators of a novelty overlooking the scene of European public policies. While many advocate the numerous benefits that social finance, and especially Social Impact Bond (SIB), will bring in the welfare systems, it seems useful to point out a considerable and comprehensible confusion. The complexity of the instruments at issue and the difficulties arisen in the first trials, require designing a depth exploration, in particular with regard to SIBs. A SIB is a financial transaction that brings together seemingly contrary forces that turn out to be uniquely capable of producing new life forms when taking advantage of their interdependencies: through a complex partnership between investors, social service providers and public administrations, SIBs develop a contractual structure that provides reimbursement and remuneration of investments by virtue of potential savings related to the social outcomes reached by social service providers. Therefore, at the same time SIB may acts as leverage for social service providers, a tool for the sustainability of public spending and an asset class for investors. The implementation of these financial instruments raises a number of important challenges to deal with, both from the point of view of its economic features and the related legal issues. The main goals this paper aims to pursue are: (i) find the socio-economic rationale of SIBs, (ii) outline an introductory and theoretically acceptable framework for the study of SIBs, (iii) indicate a possible agenda of the crucial and outstanding problems to be addressed. In other words, the aim of this paper is to sketch a possible road map to meet the challenges that Europe is facing, in the belief that an essential contribution will come from socio-economic research.
Volume (Year): 8 (2014)
Issue (Month): 2 (June)
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