I think this is a fun historical example. Ships passing through Denmark needed to pay a tax of 1-2% of the value of their cargo. They self-assessed that value.
The twist that makes it interesting was that the King could choose to purchase any cargo immediately at the reported value. If a ship underreported, they might save on tax, but they risked taking a hefty loss.
I have no idea how effective this was, but it's compelling. I wonder whether great self-regulation might need clever design like that example.
Basically, for $x amount, a competitor can buy the winning car (or its engine, or similar). Where $x is the amount the group decides should be a reasonable amount to spend on building a car.
A racer is free to spend more, but if they win too much, somebody will write a check and buy the car.
In theory. In reality, plenty of people have the money to spend $x^2 and risk the loss.