Government-sponsored prize competitions have allowed agencies to save money on new projects, better hedge risky investments and improve results by bringing together people from a range of disciplines, a report released Tuesday by the White House Office of Science and Technology Policy said.
Challenges also allow agencies to "establish an ambitious goal without having to predict which team or approach is most likely to succeed," the report said.
Federal agencies have sponsored more than 150 prize competitions since Congress established governmentwide authority for the challenges with the America COMPETES Reauthorization Act signed in January 2010.
The OSTP report details numerous challenges that yielded innovations but doesn't break down likely cost savings that resulted.
The Energy Department, for instance, helped sponsor the Progressive Insurance Automotive X Prize, which offered $10 million to teams that built cars that could reach fuel efficiency levels above 100 miles per gallon.
"As the prize did not dictate a single approach, it incentivized 111 teams from around the globe to develop a new generation of technologies in the field," the report said.