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Commissioned by DFID, this study presents concepts for understanding Development Impact Bonds (DIBs), based on economic theory. In doing so, the authors present issues relating to the evaluation of individual DIBs and how data from evaluations can be synthesised effectively into an overall evidence base related to DIBs. Also, the paper provides several recommendations drawn from a ‘six-agent model’ for understanding the actions of six focal DIB stakeholders. 

A key feature of the paper is its presentation of a framework that can be used to evaluate both the processes and impact of DIBs, the mapping of important criteria of relevance, effectiveness, efficiency, impact and sustainability, useful for evaluating development programmes. In doing so, the study considers the types of methods that could be used for evaluations including the use of experimental methods, such as cluster-based randomised controlled trials.