The steering committee recommends limited experiments in the use of federally sponsored inducement prize contests to stimulate private-sector research, innovation, and technology deployment in service of agency and societal goals.
Specifically, the committee recommends that Congress encourage federal agencies to study further the feasibility of inducement prize contests as a potential complement to their existing portfolio of science and technology policy instruments. In addition, Congress should consider providing explicit statutory authority and, where appropriate, credible funding mechanisms for agencies to sponsor and/or fund such contests.
It is important to note that the purpose of these experiments would be to test the effectiveness of prizes and contests as complements to—not replacements for—traditional R&D grants and procurement contracts.
Both Congress and federal agencies are encouraged to take a flexible approach to the design and administration of inducement prize contests.
Prize contests can be agency funded and administered; agency administered and privately funded; agency initiated and privately funded and administered; or joint agency-private sector funded and administered. Prize contest rules must be seen as transparent, simple, fair, and unbiased. Prize rewards must be commensurate with the effort required and goals sought. Moreover, prize contest designs should include mechanisms for appropriating prize money, for flexibly distributing intellectual property rights, and for reducing political influence.
Given its experimental nature, the use of prizes and contests should be accompanied by a mechanism for evaluation and a time limit.
The use of inducement prize contests should be evaluated at specified intervals by the agencies involved to determine their effectiveness and impact.