Open Market Trusts are institutions of public-private partnership that allow channeling resources to deliver public goods across stakeholder groups. The goal of such a trust is to create a unifying market-like mechanism for investing in public goods to encourages participation by public and private partners.

BARRIER

Multiple public and private stakeholders can benefit in differing ways from public goods. Improvements in education, public health, and infrastructure can generate cost-savings, new revenue, and nonmonetary benefits at federal, state, and local government levels as well as in the private sector. Often, participation is disincented by the mismatch between who funds initiatives and who benefits financially - “why would I pay for your benefit” - even within different areas of government. Further, many current programs are already creating benefits for nonparticipating partners, leaving them to ride-free on the status quo.

RESOLUTION

Creating an institution for driving public-private partnerships that strategically invest in public goods can mitigate or address the “Wrong-Pockets” and “Free-rider” problems. The creation a a specific institution can form a single ‘right-pocket’ for resource allocation. Additionally, the institution can drive for inclusion and benefit allocation in ways that incent participation.

Impact

By changing the underlying economics and aligning financial incentives, open-market trust funds can address some of the most complex of societies problems. From directing infrastructure, public-health, and even education investments, open-market trusts can generate impacts orders of magnitude beyond the initial investments that spawn them.