I believe JesseAldridge above was referring instead to government funding R&D and then simply giving away the technology the way the daguerreotype photographic process was given away. http://en.wikipedia.org/wiki/Daguerreotype
Instead of Daguerre obtaining a French patent, the French government provided a pension for him. In Britain, Miles Berry, acting on Daguerre's behalf, obtained a patent for the daguerreotype process on 14 August 1839. Almost simultaneously, on 19 August 1839, the French government announced the invention as a gift "Free to the World".
The 'large cash prize' tends to be either tenure or a fat consulting job.