Throwing good money after good

There is a notable gap in fostering innovations that enhance the delivery of government services, particularly those that cater to the needs of the most vulnerable populations. Nobel-prize winning economist Esther Duflo, co-founder and co-director of the Abdul Latif Jameel Poverty Action Lab (J-PAL), and fellow Nobel laureate in Economics Michael Kremer highlight one way to maximise the impact of spending through open, tiered, evidence-based social innovation funds like those set up by the United States, under the Development Innovation Ventures (DIV), and France, through the Fund for Innovation in Development (FID). Both funds take a page from venture capital’s playbook, focusing on areas currently underserved by funding or interest. The evidence suggests that such funds can deliver tremendous returns on investment and avoid throwing good money after bad.