What theories underpin performance-based financing? A scoping review

Purpose – The study aims to explore the theoretical bases justifying the use of performance-based financing(PBF) in the health sector in low- and middle-income countries (LMICs).Design/methodology/approach – The authors conducted a scoping review of the literature on PBF so as toidentify the theories utilized to underpin it and analyzed its theoretical justifications.Findings – Sixty-four studies met the inclusion criteria. Economic theories were predominant, with theprincipal-agent theory being the most commonly-used theory, explicitly referred to by two-thirds of includedstudies. Psychological theories were also common, with a wide array of motivation theories. Other disciplines inthe form of management or organizational science, political and social science and systems approaches alsocontributed. However, some of the theories referred to contradicted each other. Many of the studies includedonly casually alluded to one or more theories, and very few used these theories to justify or support PBF. Notheory emerged as a dominant, consistent and credible justification of PBF, perhaps except for the principalagent theory, which was often inappropriately applied in the included studies, and when it included additionalassumptions reflecting the contexts of the health sector in LMICs, might actually warn against adopting PBF.Practical implications – Overall, this review has not been able to identify a comprehensive, credible,consistent, theoretical justification for using PBF rather than alternative approaches to health system reformsand healthcare providers’ motivation in LMICs.Originality/value – The theoretical justifications of PBF in the health sector in LMICs are under-documented.This review is the first of this kind and should encourage further debate and theoretical exploration of thejustifications of PBF.