Connecticut and South Carolina will experiment with social impact bonds, it was recently reported, or has already begun using them. Private companies and nonprofits provide funding upfront to combat difficult social problems, and, if the nonprofit recipients can satisfy measurable goals, the states will pay them back with interest.

The South Carolina program, for example, will send registered nurses into the homes of low-income pregnant women to teach parenting skills and how to keep their kids healthy. It will be funded by organizations including the Duke Endowment, and researchers will determine whether the program meets goals such as fewer preterm births, fewer hospitalizations and longer intervals between births.