Why have Social Policy Bonds gone nowhere?

A correspondent asks about Social Policy Bonds:

Given how interesting [the] idea is and how much high-level attention it's received (e.g., from the likes of [Professor Robert] Shiller), what would you say are top 2-3 reasons that it has not been implemented?

I answered along the following lines:

1. The concept works best on a larger scale: that is where efficiency gains are maximised as there is more scope to shift resources between different projects and different approaches. This makes it difficult to test on a small scale in a way that would encourage uptake of the concept. For instance, Social Policy Bonds issued by one local authority would be very unpopular if one effect would be that polluters or criminals simply transfer their activities from one city to another. Bonds targeting cancer mortality rates might end up raising total mortality rates. For similar reasons, the advantages of the concept would probably be most marked over over long time periods, which again makes testing tedious.

2. Its chief proponent, until now at any rate, has been me. I have little status in the academic, business or bureaucratic world. Most people of influence would (understandably, I guess) be disinclined to take seriously any ideas originating in such a source; especially ideas that have never been tested, or at least advocated by people with more status and credibility. One instance: I have not once received a single reply, not even an acknowledgement, to my numerous emails to philanthropists, or organizations for philanthropists, or journals for philanthropists. No doubt they are swamped by emails from all sorts of people, and they have powerful filtering algorithms.

3. ...which is really (2) restated: tried, tested and failed is a better tactic for anybody in a large organization to follow. The incentives these days are to follow due process and tick boxes rather than to achieve results. The costs of trying something very new that might fail are higher than those of replicating existing approaches, even if they are doomed to fail. I think this applies within NGOs as well as government agencies.

I find that the idea generates enthusiastic support from individuals (including Prof Shiller who first wrote to me back in 1997 and senior members of governments of New Zealand and other OECD countries), but also that such support does not influence the larger systems within which the individuals operate, which rarely reward performance.