The Atlas of Innovation: A New Tool for Navigating the Innovation Funding Landscape

The United States government spends close to $200 billion annually on research and development. Every dollar counts, as innovation is crucial to solving pressing social problems and the ultimate driver of economic growth.

To make the most of R&D funding, policymakers need to consider not just what to spend the money on and how much to spend, but the very design of the funding mechanism itself. NASA’s shift from contracting with a single firm to an open competition with fixed rewards for meeting predefined milestones enabled new entrants such Space X to develop capabilities that contributed to declining space launch costs.

Policymakers have had little to go on in choosing the right innovation funding mechanism. Without better guidance, policymakers may default to choosing instruments that are familiar or in vogue or at random.

This is where the Atlas of Innovation, jointly developed by the Institute for Progress and the Market Shaping Accelerator, comes in. It helps policymakers navigate the complex landscape of funding mechanisms by asking a short series of questions. The Atlas is deeply informed by the economics literature, but that foundation is kept under the hood. It is meant to be a practical tool—providing actionable guidance based on information readily available to policymakers.

Three simple questions go a long way toward identifying the right funding mechanism:

1. Problem: How clearly can the funder articulate the problem? Do they have a broad or narrowly defined goal?
2. Solution: How clearly can funders articulate the solution(s)? Can they usefully prespecify what a solution would look like?
3. Team: How clearly can the funder identify a team to carry out the innovation? Can policymakers identify who is most capable?

Based on these questions, the Atlas recommends one of over a dozen funding mechanisms. For each recommendation, it explains when the mechanism is likely to work well and when it can fail. Each landing page also includes real-world examples, related approaches, and suggested readings.

We expect the Atlas to be useful for a wide range of public and philanthropic funders of innovation. This includes program managers at the Defense Advanced Research Projects Agency, the National Institutes of Health, and aid agencies. We also expect it will be useful for new philanthropists seeking to deploy funding, including those whose wealth will multiply after Anthropic and OpenAI have their stock initial public offerings.

We hope the Atlas serves as a starting point for funders seeking to promote innovation. We also recommend exploring our pull incentive sizing tool, which helps funders decide how much to spend on innovation incentives linked to delivering results.

If the Atlas informs your program design, or if you have suggestions for how it could be more useful to policymakers and philanthropists, we would welcome your feedback at [email protected].

The Atlas of Innovation is a project of the Market Shaping Accelerator (MSA) and the Institute for Progress (IFP). It was developed by Caleb Watney, Matthew Clancy, Christopher Snyder, Siddhartha Haria, Matthew Esche, Claire McMahon, and Sarrin Chethik. Judah D’souza served as web developer. Santi Ruiz, Beez Africa, and Eamonn Ives provided edits.

We thank the following individuals for helpful feedback that improved the Atlas of Innovation: Rachel Bonnifield, Kevin Bryan, Jordan Dworkin, Ina Ganguli, Andrew Gerard, Eric Gilliam, Rachel Griffith, Daniel Gross, Jenn Gustetic, Sabrina Howell, Michael Kremer, Jenny Kudymowa, Greg Lewis, Kyle Myers, Nan Ransohoff, Nirupama Rao, Ben Reinhardt, Adam Russell, Bhaven Sampat, Brian Silverman, Tim Simcoe, Narayan Subramanian, Misha Teplitskiy, and Dan Turner-Evans.

MSA and IFP thank the Smith Richardson Foundation, the Center for Incentive Design, and the Sijbrandij Foundation for their support of this project.