Opportunities and Challenges in the Use of Innovation Prizes as a Government Policy Instrument
- 465 Downloads
Inducement prizes have been long used to stimulate individuals and groups to accomplish diverse goals. Lately, governments have become more and more interested in these prizes and sought to include this kind of incentives within the set of policy tools available to promote science, technology, and innovation. To date, however, there has been little empirically-based scientific knowledge on how to design, manage, and evaluate innovation prizes. This note discusses aspects of the prize phenomenon and the opportunities and challenges related with the use of innovation prizes as a government policy instrument. Compared to other incentive mechanisms, prizes are likely to present advantages to, for example, accelerate the development and commercialization of technologies that are held back for diverse reasons and help to leverage public money with external ideas, collaborative efforts, and the participation of diverse individuals and organizations. Still, despite these advantages and other interesting features of prizes, there are key questions that policy-makers and scholars must address to better understand this kind of incentives and further improve prize designs and implementations before governments move forward to a more widespread use of innovation prizes in science and technology policies.
KeywordsInnovation prizes Science and technology policy Science and technology policy studies Policy instruments
This work is supported in part by the U.S. National Science Foundation under Grant Number SBE-0965103. Any opinions, findings and conclusions or recommendations expressed in this work are those of the author and do not necessarily reflect the views of the National Science Foundation.
- Brunt, Liam, Josh Lerner, and Tom Nicholas. 2008. Inducement Prizes and Innovation: National Bureau of Economic Research (NBER).Google Scholar
- Davis, Lee, and Jerome Davis. 2004. How Effective Are Prizes As Incentives To Innovation? Evidence From Three 20th Century Contests. Paper presented at the DRUID Summer Conference 2004, Elsinore, Denmark.Google Scholar
- Kay, Luciano. 2011b. How Do Prizes Induce Innovation? Learning From The Google Lunar X-Prize. Doctoral Dissertation, Georgia Institute of Technology, Atlanta, GA.Google Scholar
- Kay, Luciano. 2011c. Managing Innovation Prizes in Government. Washington, D.C.: The IBM Center for the Business of Government.Google Scholar
- National Academy of Engineering (NAE). 1999. Concerning Federally Sponsored Inducement Prizes in Engineering and Science. Washington, D.C.: National Academy of Engineering.Google Scholar
- National Research Council (NRC). 2007. Innovation Inducement Prizes at the National Science Foundation. Washington, D.C.: The National Academies Press.Google Scholar
- Newell, Richard G., and Nathan E. Wilson. 2005. Technology Prizes for Climate Change Mitigation. In Discussion Paper. Washington, D.C.: Resources For The Future.Google Scholar
- Saar, Jüri. 2006. Prizes: The Neglected Innovation Incentive. Lund University.Google Scholar
- Shavell, Steven, and Tanguy van Ypersele. 1999. Rewards Versus Intellectual Property Rights: National Bureau of Economic Research (NBER).Google Scholar
- Stine, Deborah D. 2009. Federally Funded Innovation Inducement Prizes: Congressional Research Service.Google Scholar
- Wright, Brian D. 1983. The Economics of Invention Incentives: Patents, Prizes, and Research Contracts. American Economic Review 73(4): 691.Google Scholar