Performance-Based Funding is a financial model used by governments and organizations to allocate resources based on measurable outcomes. This approach encourages institutions, such as schools or universities, to improve their performance in areas like student graduation rates or job placement statistics. Under this system, funding is tied to specific metrics, meaning that institutions receive more money if they meet or exceed set goals. This method aims to enhance accountability and efficiency, ensuring that public funds are used effectively to achieve desired results in education and other sectors.