Another form of public-private partnership may be appropriate for agencies whose research holds great immediate interest for the public, such as the National Institutes of Health (NIH). Virtually all of the 1,000 or so diseases under study at NIH have legitimate constituencies. Selecting a fraction of these diseases for federally funded contests would not be politically possible. In such cases, an alternative to federal funding might be to invite nonfederal entities to raise funds and design the contest. The federal agency's role could be to provide administration and validation.

Some Areas for Caution

If federal agencies choose to experiment with named inducement prize contests, there are several other important issues they should consider in addition to those discussed above in reference to contest design and administration. These include fundamental questions such as by whom and by what process should the technologies or societal challenges be selected for which prizes are offered? How can selection processes be designed to minimize undesired political pressures? What kind of accountability is appropriate for participants?

We want to point to a series of questions that deserve special attention when undertaking or designing prize programs and activities:

  • Do large prizes create a bandwagon effect, drawing effort to one particular challenge to the neglect of potentially more important or urgent challenges?28

  • Alternatively, would the creation of many small contests dilute the public's attention and thus render the public education and mobilization role of prizes ineffective?

  • Will prizes serve to direct scarce resources away from higher return uses? That is, what are the opportunity costs of prizes in a given area?

  • The procurement system is criticized for falling prey to political pressure, complexities of congressional oversight, and the self-protection of agencies. What could prevent prizes and contests from the same shortcomings?

  • Would the public accept the use of federal money for contests that carry the risk of failure or the waste of resources on the wrong problem?

  • Should international entrants be allowed to compete for federal prizes?

  • How should the safety and liability issues associated with prize contests be handled in today's legal climate?

  • Under what circumstances will potential negative publicity associated with losing a contest be sufficient to discourage participation?



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Concerning Federally Sponsored Inducement Prizes in Engineering and Science: Report of the Steering Committee for the Another form of public-private partnership may be appropriate for agencies whose research holds great immediate interest for the public, such as the National Institutes of Health (NIH). Virtually all of the 1,000 or so diseases under study at NIH have legitimate constituencies. Selecting a fraction of these diseases for federally funded contests would not be politically possible. In such cases, an alternative to federal funding might be to invite nonfederal entities to raise funds and design the contest. The federal agency's role could be to provide administration and validation. Some Areas for Caution If federal agencies choose to experiment with named inducement prize contests, there are several other important issues they should consider in addition to those discussed above in reference to contest design and administration. These include fundamental questions such as by whom and by what process should the technologies or societal challenges be selected for which prizes are offered? How can selection processes be designed to minimize undesired political pressures? What kind of accountability is appropriate for participants? We want to point to a series of questions that deserve special attention when undertaking or designing prize programs and activities: Do large prizes create a bandwagon effect, drawing effort to one particular challenge to the neglect of potentially more important or urgent challenges?28 Alternatively, would the creation of many small contests dilute the public's attention and thus render the public education and mobilization role of prizes ineffective? Will prizes serve to direct scarce resources away from higher return uses? That is, what are the opportunity costs of prizes in a given area? The procurement system is criticized for falling prey to political pressure, complexities of congressional oversight, and the self-protection of agencies. What could prevent prizes and contests from the same shortcomings? Would the public accept the use of federal money for contests that carry the risk of failure or the waste of resources on the wrong problem? Should international entrants be allowed to compete for federal prizes? How should the safety and liability issues associated with prize contests be handled in today's legal climate? Under what circumstances will potential negative publicity associated with losing a contest be sufficient to discourage participation?