$300 Million is Incentive Enough
Matthew Yglesias doesn’t think Sen. John McCain’s $300 million prize for improved automotive batteries:
On top of all that, $300 million seems preposterously low. A good electric car battery would earn you way more money than that in the course of things. For a prize to make sense, the scale of the prize needs to be large relative to the potential profitability of the invention.
He underestimates the power of the human ego. According to Wired Scaled Composites spent $25 million to win the $10 million X Prize by sending SpaceShipOne into space. The payoff was Richard Branson licensing the companies technology for his Virgin Galactic space tourism company. A $300 million prize will get a lot of creative juices flowing.