The evidence on the effectiveness of Payment by results for outputs, outcomes and impact is mixed. A new working paper show that Payment by results appears to have been effective in some cases and circumstances, but that effectiveness, let alone cost effectiveness (or value added) of PbR in general is by no means certain.
All in all, the drive to payment by results in sectors like health and education often seems to be more induced by domestic motivations to “show results” than by considerations of aid effectiveness.