Is payment by results just the most recent over-hyped solution for development,or is it an effective incentive for accelerating change? When reading up on payment by results (PbR) recently I was struck by the contrast between how quickly it has spread through the aid world and how tiny evidence there is that it actually works.
In a way, this is unavoidable with a new idea – you produce the case for it based on theory, or then you implement,then you test and improve or abandon. In this case the theory, ably argued by middle for Global Development (CGD) and others, and was that PbR aligns incentives in developing country governments with development outcomes,and encourages innovation, since it does not specify how to, and for example,reduce maternal mortality, merely rewards governments when they achieve it.
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Source: theguardian.com