announcement, the duration of the prize contest, how winners are determined, the engagement of expert and interested groups, and other factors. In the remainder of this chapter a number of issues in the design of such a program are discussed and preferred alternatives suggested. The next chapter discusses a process and criteria for selecting some initial prize topics. It discusses several potential prize topics to illustrate selection processes and criteria.


We begin with a general description of an innovation inducement prize program and then discuss a number of specific issues regarding such a program.

The committee recommends that NSF establish a multiyear, continuing innovation inducement prize program. NSF should assume primary responsibility for the design and implementation of the program. NSF should also take full advantage of the interests and capabilities of other federal agencies as well as of diverse private parties, when appropriate enlisting them as partners in the program. NSF should consult widely with professional and technical societies, industry associations, entrepreneurs and investors, industrial R&D managers, public interest organizations and others in designing and implementing the prize contests it sponsors. NSF should experiment with a variety of types of prizes, as discussed below, as well as with the mechanisms used to induce a wide range of contestants to pursue the prize awards.

The committee envisions that, at least initially, the funds used to pay for the prize awards (i.e., the prize purse), as well as those needed to administer the prize program contests, will be appropriated for these purposes by Congress. Such funding should be in addition to rather than a substitute for funds appropriated to NSF in support of research and education in science, mathematics, and engineering. As indicated above, the committee anticipates that in addition, contestants will undertake private investments in the research and development activities entailed in competing for the prizes. The magnitude of these investments will depend on the nature of the prize objective and the opportunities for publicity and other benefits, among other factors. The committee does not believe that the primary reason for government sponsorship of a prize contest is to save taxpayers’ money relative to the cost of accomplishing the objective through a grant program or procurement. Rather, the primary reason for offering a prize is to attract different parties to contribute to a recognized societal or scientific objective.

The NSF program should offer prizes in a range of fields to address a diverse set of national challenges. Prizes would differ substantially in

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