Technological Innovation and Prize Incentives

Technological Innovation and Prize Incentives

The Google Lunar X Prize and Other Aerospace Competitions

Luciano Kay

In this in-depth study, Luciano Kay focuses on three recent cases of prize competitions in the aerospace industry: the Google Lunar X Prize, the Ansari X Prize and the Northrop Grumman Lunar Lander Challenge. Using a combination of real-time and historical analysis based on personal interviews, workplace visits and questionnaire and document data analysis, the author examines the particular dynamics of the prize phenomenon and offers a comprehensive discussion of the potential of prizes to induce innovation. This fascinating volume also sets out a systematic method to studying prize incentives, offering a concrete innovation model and case study design approach that will prove highly useful to further research efforts in the field.

Chapter 9: Conclusions

Luciano Kay

Subjects: innovation and technology, innovation policy, technology and ict, politics and public policy, public policy


Inducement prizes, where cash rewards are given to motivate the attainment of targets, have long been used to stimulate individuals, groups and communities to accomplish diverse types of goals. Lately, prizes that reward the achievement of technological targets have increasingly attracted attention due to their potential to induce path-breaking innovations and accomplish related goals, such as economic recovery or the engagement of social groups to create innovation communities. Governments have become more and more interested in these prizes and, particularly in the USA, sought to include this incentive mechanism within the set of policy tools available to promote science, technology and innovation. Innovation prizes, or prizes that involve some kind of technological innovation, are among those that policy makers are most interested in. To date however, despite the long history of prizes as incentives for science and technology, their notable potential, recent popularity and increasing policy interest, there has been little empirically based scientific knowledge on how to design, manage and evaluate innovation prizes. This research has investigated technology prizes and the means by which they induce innovation or other effects related with technological development. The project was set out to engage four key aspects of prizes for which there have been significant knowledge gaps: the motivation of entrants, their R & D activities, their technology outputs and the overall effect of prizes on innovation. Using an empirical, multiple case-study methodology and multiple types of data sources, this research investigated three cases of recent aerospace technology prizes: a main case study, the Google Lunar X Prize (GLXP) for robotic Moon exploration; and two pilot cases, the Ansari X Prize (AXP) for the first private reusable manned spacecraft, and the Northrop Grumman Lunar Lander Challenge (NGLLC) for flights of reusable rocket-powered vehicles.

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