IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v107y2020icp186-196.html
   My bibliography  Save this article

The role of public procurement in the formation of markets for innovation

Author

Listed:
  • Bleda, Mercedes
  • Chicot, Julien

Abstract

In this work we analyse the ways in which public procurement can encourage business innovation by supporting the formation of markets for new products, technologies and services. We use an evolutionary analytical framework in which markets for innovation are defined as dynamic complex systems whose function is the creation and coordination of knowledge as they develop over time. We show that public procurement has a key role in supporting this function throughout all the stages in the process of market development, and identify specific tools and actions that can be implemented at different phases of the procurement cycle to do so. We illustrate the main conceptual arguments of our analysis with examples from existing case studies on the public procurement of innovations.

Suggested Citation

  • Bleda, Mercedes & Chicot, Julien, 2020. "The role of public procurement in the formation of markets for innovation," Journal of Business Research, Elsevier, vol. 107(C), pages 186-196.
    • Handle: RePEc:eee:jbrese:v:107:y:2020:i:c:p:186-196
    DOI: 10.1016/j.jbusres.2018.11.032
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148296318305848
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbusres.2018.11.032?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Max Rolfstam, 2009. "Public procurement as an innovation policy tool: The role of institutions," Science and Public Policy, Oxford University Press, vol. 36(5), pages 349-360, June.
    2. Julien Chicot & Mireille Matt, 2018. "Public procurement of innovation: a review of rationales, designs, and contributions to grand challenges," Science and Public Policy, Oxford University Press, vol. 45(4), pages 480-492.
    3. Edler, Jakob & Georghiou, Luke, 2007. "Public procurement and innovation--Resurrecting the demand side," Research Policy, Elsevier, vol. 36(7), pages 949-963, September.
    4. G. M.P. Swann, 2009. "The Economics of Innovation," Books, Edward Elgar Publishing, number 13211.
    5. Roy Rothwell, 1984. "Creating a Regional Innovation-Oriented Infrastructure: The Role of Public Procurement," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 55(2), pages 159-172, April.
    6. Edquist, Charles & Zabala-Iturriagagoitia, Jon Mikel, 2012. "Public Procurement for Innovation as mission-oriented innovation policy," Research Policy, Elsevier, vol. 41(10), pages 1757-1769.
    7. Gerard P. Hodgkinson, 1997. "Cognitive Inertia in a Turbulent Market: the Case of UK Residential Estate Agents," Journal of Management Studies, Wiley Blackwell, vol. 34(6), pages 921-945, November.
    8. Gian Luigi Albano & Marco Sparro, 2010. "Flexible Strategies for Centralized Public Procurement," Review of Economics and Institutions, Università di Perugia, vol. 1(2).
    9. Cohendet, Patrick & Meyer-Krahmer, Frieder, 2001. "The theoretical and policy implications of knowledge codification," Research Policy, Elsevier, vol. 30(9), pages 1563-1591, December.
    10. Richard R. Nelson, 2009. "Building Effective ‘Innovation Systems’ versus Dealing with ‘Market Failures’ as Ways of Thinking About Technology Policy," Chapters, in: Dominique Foray (ed.), The New Economics of Technology Policy, chapter 2, Edward Elgar Publishing.
    11. Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626, National Bureau of Economic Research, Inc.
    12. Vargo, Stephen L. & Koskela-Huotari, Kaisa & Baron, Steve & Edvardsson, Bo & Reynoso, Javier & Colurcio, Maria, 2017. "A systems perspective on markets – Toward a research agenda," Journal of Business Research, Elsevier, vol. 79(C), pages 260-268.
    13. James Stanley Metcalfe, 2005. "Systems Failure and the Case for Innovation Policy," Springer Books, in: Patrick Llerena & Mireille Matt (ed.), Innovation Policy in a Knowledge-Based Economy, chapter 2, pages 47-74, Springer.
    14. Georghiou, Luke & Edler, Jakob & Uyarra, Elvira & Yeow, Jillian, 2014. "Policy instruments for public procurement of innovation: Choice, design and assessment," Technological Forecasting and Social Change, Elsevier, vol. 86(C), pages 1-12.
    15. Bleda, Mercedes & del Río, Pablo, 2013. "The market failure and the systemic failure rationales in technological innovation systems," Research Policy, Elsevier, vol. 42(5), pages 1039-1052.
    16. Richard R. Nelson, 1959. "The Simple Economics of Basic Scientific Research," Journal of Political Economy, University of Chicago Press, vol. 67, pages 297-297.
    17. David J. Teece & Gary Pisano & Amy Shuen, 1997. "Dynamic capabilities and strategic management," Strategic Management Journal, Wiley Blackwell, vol. 18(7), pages 509-533, August.
    18. Dimitri,Nicola & Piga,Gustavo & Spagnolo,Giancarlo (ed.), 2006. "Handbook of Procurement," Cambridge Books, Cambridge University Press, number 9780521870733.
    19. Laranja, Manuel & Uyarra, Elvira & Flanagan, Kieron, 2008. "Policies for science, technology and innovation: Translating rationales into regional policies in a multi-level setting," Research Policy, Elsevier, vol. 37(5), pages 823-835, June.
    20. Jason Potts, 2001. "Knowledge and markets," Journal of Evolutionary Economics, Springer, vol. 11(4), pages 413-431.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jessica Catalano & Francesco Giffoni & Paolo Castelnovo, 2021. "The impact of space procurement on suppliers: Evidence from Italy," Working Papers 202102, CSIL Centre for Industrial Studies.
    2. AlNuaimi, Bader K. & Singh, Sanjay Kumar & Harney, Brian, 2021. "Unpacking the role of innovation capability: Exploring the impact of leadership style on green procurement via a natural resource-based perspective," Journal of Business Research, Elsevier, vol. 134(C), pages 78-88.
    3. Edler, Jakob, 2023. "Demand, public procurement and transformation," Discussion Papers "Innovation Systems and Policy Analysis" 79, Fraunhofer Institute for Systems and Innovation Research (ISI).
    4. Antonio Martínez Raya & Víctor M. González-Sánchez, 2020. "Tender Management Relating to Imposition of Public Service Obligations on Scheduled Air Routes: An Approach Involving Digital Transformation of Procurement Procedures in Spain," Sustainability, MDPI, vol. 12(13), pages 1-27, July.
    5. Md. Raquibuzzaman Khan & Nazia Tabassum & Niaz Ahmed Khan & Mohammad Jahangir Alam, 2022. "Procurement challenges in public-sector agricultural development projects in Bangladesh," Palgrave Communications, Palgrave Macmillan, vol. 9(1), pages 1-13, December.
    6. Allal-Chérif, Oihab & Simón-Moya, Virginia & Ballester, Antonio Carlos Cuenca, 2021. "Intelligent purchasing: How artificial intelligence can redefine the purchasing function," Journal of Business Research, Elsevier, vol. 124(C), pages 69-76.
    7. Zhengjun Hu & Shanshan Li, 2023. "Innovation-Driven Policy and Low-Carbon Technology Innovation: Research Driven by the Impetus of National Innovative City Pilot Policy in China," Sustainability, MDPI, vol. 15(11), pages 1-18, May.
    8. Uyarra, Elvira & Zabala-Iturriagagoitia, Jon Mikel & Flanagan, Kieron & Magro, Edurne, 2020. "Public procurement, innovation and industrial policy: Rationales, roles, capabilities and implementation," Research Policy, Elsevier, vol. 49(1).
    9. Castelnovo, Paolo & Clò, Stefano & Florio, Massimo, 2023. "A quasi-experimental design to assess the innovative impact of public procurement: An application to the Italian space industry," Technovation, Elsevier, vol. 121(C).
    10. Elvira Uyarra & Kieron Flanagan & Edurne Magro & Jon Mikel Zabala-Iturriagagoitia, 2017. "Anchoring the innovation impacts of public procurement to place: The role of conversations," Environment and Planning C, , vol. 35(5), pages 828-848, August.
    11. Cristina Mele & Jaqueline Pels & Maria Spano & Irene Bernardo, 2023. "Emergent understandings of the market," Italian Journal of Marketing, Springer, vol. 2023(1), pages 1-25, March.
    12. Brea, Edgar, 2023. "A framework for mapping actor roles and their innovation potential in digital ecosystems," Technovation, Elsevier, vol. 125(C).
    13. Zhang, Zhaowen & Jiang, Yaohui, 2022. "Can green public procurement change energy efficiency? Evidence from a quasi-natural experiment in China," Energy Economics, Elsevier, vol. 113(C).
    14. Rocsana Bucea-Manea-Țoniș & Oliva Maria Dourado Martins & Dragan Ilic & Mădălina Belous & Radu Bucea-Manea-Țoniș & Cezar Braicu & Violeta-Elena Simion, 2020. "Green and Sustainable Public Procurement—An Instrument for Nudging Consumer Behavior. A Case Study on Romanian Green Public Agriculture across Different Sectors of Activity," Sustainability, MDPI, vol. 13(1), pages 1-25, December.
    15. Yunjuan Liang & Xin Liang & Hua Wei, 2023. "Sustainable Quality-Incentive Contract Design of Public Technology Innovation Procurement under Asymmetry Information," Sustainability, MDPI, vol. 15(11), pages 1-22, May.
    16. Dai, Xiaoyong & Li, Yanchao & Chen, Kaihua, 2021. "Direct demand-pull and indirect certification effects of public procurement for innovation," Technovation, Elsevier, vol. 101(C).
    17. Miller, Fiona A. & Lehoux, Pascale, 2020. "The innovation impacts of public procurement offices: The case of healthcare procurement," Research Policy, Elsevier, vol. 49(7).
    18. Pan, An & Zhang, Wenna & Shi, Xunpeng & Dai, Ling, 2022. "Climate policy and low-carbon innovation: Evidence from low-carbon city pilots in China," Energy Economics, Elsevier, vol. 112(C).
    19. Leckel, Anja & Veilleux, Sophie & Dana, Leo Paul, 2020. "Local Open Innovation: A means for public policy to increase collaboration for innovation in SMEs," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    20. Yanlin Ma & Yuting Liu & Andrea Appolloni & Junqi Liu, 2021. "Does green public procurement encourage firm's environmental certification practice? The mediation role of top management support," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(3), pages 1002-1017, May.
    21. Jakob Edler, 2023. "Demand, public procurement and transformation," MIOIR Working Paper Series 2023-03, The Manchester Institute of Innovation Research (MIoIR), The University of Manchester.
    22. Congli Su & Mingxi Wang, 2022. "Quality incentive contract design in government procurement for innovation," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(8), pages 3665-3684, December.
    23. Tudor Ciumara & Iulia Lupu, 2020. "Green Procurement Practices in Romania: Evidence from a Survey at the Level of Local Authorities," Sustainability, MDPI, vol. 12(23), pages 1-12, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bleda, Mercedes & del Río, Pablo, 2013. "The market failure and the systemic failure rationales in technological innovation systems," Research Policy, Elsevier, vol. 42(5), pages 1039-1052.
    2. Chicot, J. & Matt, M., 2015. "Public procurement of innovation: a review of rationales, instruments and design," Working Papers 2015-05, Grenoble Applied Economics Laboratory (GAEL).
    3. Julien Chicot & Mireille Matt, 2018. "Public procurement of innovation: a review of rationales, designs, and contributions to grand challenges," Science and Public Policy, Oxford University Press, vol. 45(4), pages 480-492.
    4. Kiyoon Shin & Yeongjun Yeo & Jeong-Dong Lee, 2020. "Revitalizing the Concept of Public Procurement for Innovation (PPI) from a Systemic Perspective: Objectives, Policy Types, and Impact Mechanisms," Systemic Practice and Action Research, Springer, vol. 33(2), pages 187-211, April.
    5. Ghisetti, Claudia, 2017. "Demand-pull and environmental innovations: Estimating the effects of innovative public procurement," Technological Forecasting and Social Change, Elsevier, vol. 125(C), pages 178-187.
    6. Paula Cayolla Trindade & Paula Antunes & Paulo Partidário, 2017. "SPP Toolbox: Supporting Sustainable Public Procurement in the Context of Socio-Technical Transitions," Sustainability, MDPI, vol. 10(1), pages 1-26, December.
    7. Dirk Czarnitzki & Paul Hünermund & Nima Moshgbar, 2018. "Public procurement as policy instrument for innovation," Working Papers of Department of Management, Strategy and Innovation, Leuven 606259, KU Leuven, Faculty of Economics and Business (FEB), Department of Management, Strategy and Innovation, Leuven.
    8. Obwegeser, Nikolaus & Müller, Sune Dueholm, 2018. "Innovation and public procurement: Terminology, concepts, and applications," Technovation, Elsevier, vol. 74, pages 1-17.
    9. Edquist, Charles & Zabala-Iturriagagoitia, Jon Mikel, 2020. "Functional procurement for innovation, welfare and the environment," Papers in Innovation Studies 2020/1, Lund University, CIRCLE - Centre for Innovation Research, revised 19 Jul 2020.
    10. Serenella Caravella & Francesco Crespi, 2021. "The role of public procurement as innovation lever: evidence from Italian manufacturing firms," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 30(7), pages 663-684, October.
    11. René Belderbos & Leo Sleuwaegen & Reinhilde Veugelers, 2010. "Market Integration and Technological Leadership in Europe," European Economy - Economic Papers 2008 - 2015 403, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    12. Carlos Contreras & Julio Angulo, 2022. "Innovation and Tariff-adjustment Options in Public-private Partnerships," Hacienda Pública Española / Review of Public Economics, IEF, vol. 243(4), pages 51-81, December.
    13. Czarnitzki, Dirk & Hünermund, Paul & Moshgbar, Nima, 2020. "Public Procurement of Innovation: Evidence from a German Legislative Reform," International Journal of Industrial Organization, Elsevier, vol. 71(C).
    14. Mehmet Akif Demircioglu & Roberto Vivona, 2021. "Positioning public procurement as a procedural tool for innovation: an empirical study [Creating the Conditions for Radical Public Service Innovation]," Policy and Society, Darryl S. Jarvis and M. Ramesh, vol. 40(3), pages 379-396.
    15. Cornelia Storz & Tobias ten Brink & Na Zou, 2022. "Innovation in emerging economies: How do university-industry linkages and public procurement matter for small businesses?," Asia Pacific Journal of Management, Springer, vol. 39(4), pages 1439-1480, December.
    16. Dai, Xiaoyong & Li, Yanchao & Chen, Kaihua, 2021. "Direct demand-pull and indirect certification effects of public procurement for innovation," Technovation, Elsevier, vol. 101(C).
    17. Stojčić, Nebojša & Srhoj, Stjepan & Coad, Alex, 2020. "Innovation procurement as capability-building: Evaluating innovation policies in eight Central and Eastern European countries," European Economic Review, Elsevier, vol. 121(C).
    18. Iizuka, Michiko & Ikeda, Yoko, 2021. "Regulation and innovation under the 4th industrial revolution: The case of a healthcare robot, HAL by Cyberdyne," Technovation, Elsevier, vol. 108(C).
    19. Mwesiumo, Deodat & Glavee-Geo, Richard & Olsen, Kjetil Magnus & Svenning, Geir Arne, 2021. "Improving public purchaser attitudes towards public procurement of innovations," Technovation, Elsevier, vol. 101(C).
    20. Elvira Uyarra & Kieron Flanagan & Edurne Magro & Jon Mikel Zabala-Iturriagagoitia, 2017. "Anchoring the innovation impacts of public procurement to place: The role of conversations," Environment and Planning C, , vol. 35(5), pages 828-848, August.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:107:y:2020:i:c:p:186-196. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.