Thanks a lot for your elaborate and thoughtful comment! A quick reaction to your thoughts:
Unfortunately, the literature we reviewed did not seem to be very clear-cut on the question of when exactly to use prizes vs. grants (or other incentives). Intuitively, I’d agree that a prize makes sense (vs. a grant) when identifying a suitable candidate is difficult. To me, this point is already broadly covered by “when the goal is clear, but the path to achieving it is not”, as when you don’t know how to solve something, you may also not know who could solve it. Could you give an example of how moral hazard can come into play?
Thanks for pointing out more design issues! Our report is definitely not exhaustive with regard to how best to design a prize. I don’t fully remember why we did not include the specific design issues you mention, but it is likely because we didn’t find good (quasi-) experimental literature on them. Case studies might be useful here.
I agree that recognition prizes are likely less useful than inducement prizes when you have a very specific problem to be solved. I think recognition prizes are useful when you generally want to increase research and attention to a specific topic, which can help reveal new problems to be solved that you didn’t even think of in the first place.
I think I share your intuition here. I can definitely imagine that financial incentives might potentially be more important in smaller, unglamorous prizes. We focused on large innovation prizes in our report, so I am not sure what’s the most effective incentive structure for small prizes.
Thanks a lot for your elaborate and thoughtful comment! A quick reaction to your thoughts:
Unfortunately, the literature we reviewed did not seem to be very clear-cut on the question of when exactly to use prizes vs. grants (or other incentives). Intuitively, I’d agree that a prize makes sense (vs. a grant) when identifying a suitable candidate is difficult. To me, this point is already broadly covered by “when the goal is clear, but the path to achieving it is not”, as when you don’t know how to solve something, you may also not know who could solve it. Could you give an example of how moral hazard can come into play?
Thanks for pointing out more design issues! Our report is definitely not exhaustive with regard to how best to design a prize. I don’t fully remember why we did not include the specific design issues you mention, but it is likely because we didn’t find good (quasi-) experimental literature on them. Case studies might be useful here.
I agree that recognition prizes are likely less useful than inducement prizes when you have a very specific problem to be solved. I think recognition prizes are useful when you generally want to increase research and attention to a specific topic, which can help reveal new problems to be solved that you didn’t even think of in the first place.
I think I share your intuition here. I can definitely imagine that financial incentives might potentially be more important in smaller, unglamorous prizes. We focused on large innovation prizes in our report, so I am not sure what’s the most effective incentive structure for small prizes.