Carl Bergstrom: The inherent inefficiency of grant proposal competitions and the possible benefits of lotteries in allocating research funding

A large fraction of scientific research funding is alloca- ted through a system of grant proposals and awards. We use the economic theory of contests to analyze the economic efficiency of this process. Investigators participate in contests to write high-quality proposals. Funding agencies use these contests not as a mechanism for extracting work from participants, but rather as a screening mechanism intended to reveal the most promising research projects. As a first approximation, the work that investigators do in proposal preparation provides no extrinsic value to the funder. We find that the effort researchers expend in preparing proposals may be comparable to the total scientific value of the additional funding. The problem may be exacerbated as the fraction of funded proposals drops. When investigators derive non-scientific utility from their funding successes (in the forms of e.g., hiring, promotion, tenure, or reputation), the net effect of a funding program on scientific productive can be negative. We suggest that partial lotteries for funding may ameliorate the problem by reducing the intensity of competition and the extra-scientific benefits associated with funding success.

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Carl T. Bergstrom

Professor, Department of Biology, University of Washington

Carl T. Bergstrom is a Professor in the Department of Biology at the University of Washington. Dr. Bergstrom’s research uses mathematical, computational, and statistical models to understand how information flows through biological and social systems. His recent projects include contributions to the game theory of communication and deception, use of information theory to the study of evolution by natural selection, game-theoretic models and empirical work on the sociology of science, and development of mathematical techniques for mapping and comprehending large network datasets. In the applied domain, Dr. Bergstrom’s work illustrates the value of evolutionary biology for solving practical problems in medicine and beyond. These problems include dealing with drug resistance, handling the economic externalities associated with anthropogenic evolution, and controlling novel emerging pathogens such as the SARS virus, Ebola virus, and H5N1 avian influenza virus.He is the coauthor of the college textbook Evolution, published by W. W. Norton and Co., and teaches undergraduate courses on evolutionary biology, evolutionary game theory, and the importance of evolutionary biology to the fields of medicine and public health. Dr. Bergstrom received his Ph.D. in theoretical population genetics from Stanford University in 1998; after a two-year postdoctoral fellowship at Emory University, where he studied the ecology and evolution of infectious diseases, he joined the faculty at the University of Washington in 2001.