Contest Time?

Why do people enter competitions? Because people like to compete. Why do competitions have prizes? Because people like to win.

The British parliament recognized those concepts in 1714, when it initiated a contest with a 20,000-pound prize to the inventor who developed a reliable method of determining longitude -- a measurement that would help ships stay on course.

In recent years, the most famous competitions have been funded by the private sector, most notably by the X Prize Foundation. Its $10 million contest for a private spacecraft produced a winner in 2004, and it is now running $10 million contests for rapid human genome sequencing and super-fuel-efficient cars, plus a $30 million contest for a privately funded robotic lunar lander. Those awards, like the longitude money, are inducements, which encourage new innovations, rather than recognition, like the Oscars, which reward previous accomplishments.

Government agencies have been reticent to use such contests to achieve their goals. Grants and contracts are the most common ways that agencies attract third parties to do work for them, although both are often highly specific in the expected outcomes and the means by which those outcomes are to be achieved. Through grants and contracts, agencies can ensure that third parties comply with the host of laws and rules that govern the expenditure of taxpayer dollars.

Prize competitions tend to be less restrictive on the means by which participants can achieve the desired goals. That's a strike against their use by agencies. The government's budgeting process also gets in the way, as does the likelihood of politicization through Congress or by executive branch political appointees.

Thomas Kalil, a fellow at the Center for American Progress in Washington, studied the potential of prize competitions when he served on the Clinton administration's National Economic Council in the late 1990s. He has proposed that agencies experiment with the use of prizes for several reasons. One is to tap into atypical sources, such as private inventors and entrepreneurs, who may have surprising ideas for how to achieve goals that would not surface through traditional government grants, contracts or in-house development. Another is to engage the public in innovation through competition, the way American Idol has engaged the public through musical competition. Another reason is that the government would only expend taxpayer dollars if someone actually accomplished the prize's goals. Inventors would be likely to leverage private sector dollars in the pursuit of the government's prize offering.

That's what happened when the Defense Advanced Research Projects Agency over the past few years held a competition for unmanned ground vehicles capable of maneuvering through urban battlefields. The ultimate winner of the 2007 competition, a team from Carnegie Mellon University and General Motors, lined up a host of corporate sponsors to fund the development of its vehicle. Following on that competition, the Pentagon is sponsoring a $1 million prize for the developer of lightweight batteries that soldiers could wear in combat to power the equipment they lug around.

Similarly, NASA is sponsoring a slate of prizes for a variety of innovations by getting private companies to offer monetary awards. Last year, a $200,000 prize went to Peter Homer, an unemployed engineer from Maine who designed new astronaut gloves.

Members of Congress have proposed a variety of additional prizes to spur innovation, but none have been taken up yet by agencies. The longitude prize offers a cautionary tale if the government catches the prizes bug. In that case, the prize became heavily politicized, and the inventor of the primary technology for determining longitude, John Harrison, had to fight long and hard to get his due reward. He never got the full 20,000 pounds.