Quite simply, competitions and conventions are money-makers. Of course there are competitions and conventions that are based more on the advancement of the art than monetary gain, but these are not the types of organizations I will not address because they are much rarer. Most companies that produce for-profit events charge money to participating dancers, ensembles, and audiences. There may also be an extra charge for crowded master classes, which are sometimes open to the public to allow for greater return. In sum, the more people drawn into the enterprise, the more money its producers will reap. This emphasis on profit usually detacts from the development of the participating dancers.
One of the possible hindrances of development as a dancer is that, to create a higher gross, many competitions will award all participants simply for participating. This action does, however, have the possible upside of encouragement. It is important to encourage artists, especially in a world as potentially demeaning as dance. Awarding all particpants both credits the hard work and self-abandonment that dance requires, and hence it is a positive aspect. Also, "losing" or not receiving first place can be a deterrent when young dancers are considering continuing dance. Especially when there are only competition-based studios available to youths, receiving an acknowledgement of hard work helps to sustain a positive attitude towards dance, possibly until a confidence in their own abilities has been established; such awards may help to sustain interest in dance so that a dancer decides, based on experience rather than discouragement, whether or not he/she wishes to continue studying the art form. That said, dance is a hard lifestyle and younger dancers eventually need to prepare themselves. They need to prepare themselves for the reality of not being cast in a piece, accepted into a company, or walking away with a prize. Therefore, the lesson being taught by rewards based solely on participation is questionable. If dancers become adjusted to constant positive reinforcement, it may be harder to adjust to the lack of extra encouragement in the professional sphere. In reality not everyone wins and it is not necessarily logical or realistic to make it seem otherwise.
The biggest benefit to the participant in a competition or convention, despite any monetary qualms, is camaraderie. Not only can dancers grow closer to and more supportive of each other when placed in an unfamiliar situation, but the chance to befriend dancers from other regions is invaluable. Dance is time-consuming and many dancers have little time left to themselves, so meeting others who are equally as devoted can be a rare opportunity. The chance to make connections that may serve a dancer well in the future is also extremely important: much of a dancer's success is determined by the experiences he/she has had and by the impressions made on the people he/she has come into contact with during those experiences. If the dancer does not meet anyone valuable to network with, at least they may have come away with a friend. This should be the real, equally attainable prize.