Recent thinking about innovation and industrial policy emphasises purposeful related diversification strategies or more transformative—but potentially riskier—challenge-orientated policies. Meanwhile public procurement is increasingly seen as a key means of fostering innovation. We conceptualize the multiple roles of public procurement in an innovation policy landscape shaped by these emerging rationales, and explore the complexities and institutional work associated with its implementation. We identify some possible roles for government in fostering diversification and transformation through public procurement and explore the implementation challenges of institutionalising public procurement as part of innovation policy. Both the multiple potential roles of public procurement and the institutional work associated with its implementation are illustrated with the case of Galicia, Spain.
Uyarra E., Zabala-Iturriagagoitia J.M., Flanagan K. & Magro E. (2020) Public procurement, innovation and industrial policy: Rationales, roles, capabilities and implementation. Research Policy, 49(1).
Reader in Innovation Studies and Co-Director of the Manchester Institute of Innovation Research
The interview transcript
Hi, welcome to coffee break with researchers.
Today I’m at the Regional Innovation Policy Conference in Florence and I’m having a coffee break with Elvira Uyarra, she is a reader in innovation studies and co-director of the Manchester Institute of innovation research at the Alliance Manchester Business School of the University of Manchester in the UK.
Elvira, thank you very much for having the time to have a coffee break with me, we’re having both Colombian black coffee today I hope you are enjoying it. How are you?
I’m fine thank you very much, and thank you for inviting me.
I was reading one of your latest papers, in which you analyze public procurement in innovation and industrial policy. Could you please tell me what the paper was about?
What this paper is first of all co-authored with Edurne Magro, Jon Mikel Zabala-Iturriagagoitia, from the University of Deusto, and also with my colleague Flanagan at Manchester. And the paper looks at this new policy instrument, which is public recruitment of innovation and there it’s been favoured a lot it’s there’s been a lot of work about the rationale of its use, it is a very good instrument but not many people are using it, especially at the regional level, so we in the paper we try to look at why some regions to be why should they be using this instrument, and also what it does it take to implement it effectively, so for the paper we use the case of a particular region in Spain in Galicia, through interviews and document analysis, we analyze how they manage to use to implement and institutionalize this policy practice, because somehow they have to use quite widely. I wanted to know how come in a kind of peripheral region, how come are they are the so advanced in this kind of quite novel and, you know, transformative instrument.
I see from the paper that understanding how institutional entrepreneurs play a role in this procurement is quite important, how do you understand this role of institutional entrepreneurs.
Yes, so in this case we find that the implementation of the policy was down to the role of key actors and institution entrepreneurs, which are understood in the literature as organizations or individuals whose work was changing institutions or disrupting institutions, and so what were we were interested in is what actions and what activities they undertook over a period of let’s say 10 years from the first introduction of the policy to its institutionalization. So we found that they were very active in lobbying for resources, also lobbying at the governmental level to be able to use this policy because it wasn’t people who didn’t know what it was they were not sure about using it, they were resistant they thought it was expensive and too risky, so they had a hard work in convincing people, also trained people, change the legal framework, and the regulations and the guidelines and the procedures so that took a really long time and, eventually, a lot of people in the government are using it. So what we find is that you know police implementation is complex and takes a long time and it’s often down to key individuals.
That is indeed very interesting, so in addition to that finding which you highlighted the role of institutional entrepreneurs and the time for police implementation, which additional finding you would like to highlight from the paper?
An additional insight of the paper is to unpack the rationale for the use of public procurement of innovation as an industrial policy tool, well what we’ve said in the paper is that looking at the demand side is interesting both for smart specialization type of objectives or being more selective in your innovation policy targeting particular areas rather than you know everything, are on the other side trying to be more transformative in addressing societal challenges and public sector needs, so there is two tendencies in innovation policy right now, one is kind of going for more directionality kind of doing particular types of innovation and the other one is being more selective, which is the smart specialization type of policies, so we thought the parallel procurement is a good instrument that addresses both those things.
Thank you for that that’s indeed very important to know and I would like to know also what was the main motivation you had when you and your colleagues of course wrote the paper.
So the main motivation is the policies in peripheral regions and lagging regions, so I’m interested in how regions that are lagging behind can use innovation policy for economic growth and as we know my motivation in my races for a long time so the first thing is trying to see how they can use the demand side and part of procurement and the second is how they can build a capacity for innovation policy, so we know there is a problem of absorptive capacity in regions when it comes to using funds for innovation policy so paying attention to implementation of policies and creating capacity at a regional level I think it was an important motivation for me.
Based on the findings, which ones would you say are the main policy implications?
Okay, so one policy implication is the need to move away from the linear model of innovation and the very supply-side bias of many innovation policy tool kits you know that we tend to rely on traditional tools like R&D subsidies, and so on, and we need to have a more better balance between supply-side tools and demand-side tools and part procurement of innovation is one of those potential demand side instruments.
The second one is the need to pay attention to actors and agency in innovation policy, we tend to see entrepreneurs or only firms and so on, but also institutional entrepreneurs are important and another one is the need to pay attention to implementation and not just, you know, the launch of a strategy how you’re going to implement it capacities for implementation and how that happens over time, so introductional policies are not straightforward they often take time and they require ability building in the regional level.
Thank you very much for that that’s very good to know and thank you once again for having the time to chat with me it was a pleasure for me to have you here in a coffee break and I hope to see you next time.
Thank you thank you for watching if you are interested in more details about this academic publication please find here the link below and see you next time bye-byeTags: Implementation, Industrial Policy, Innovation-orientated public procurement, institutional entrepreneurship, Institutional work, Smart specialisation