Pre-commercial procurement, procurement of innovative solutions and innovation partnerships in the EU: rationale and strategy

Elisabetta Iossa, Federico Biagi and Paola Valbonesi

Economics of Innovation and New Technology, 2018, vol. 27, issue 8, 730-749

Abstract: We discuss public procurement instruments for acquiring innovation, focusing on the European Pre-commercial Procurement, Procurement of Innovative Solutions and Innovation Partnerships. We analyse, in particular, how firms’ innovation incentives are affected by: (i) economies of scope and externalities between R&D and large-scale production; (ii) the degree of specificity of the innovation; (iii) the presence of Small and Medium Enterprises in the market and the level of market competition; (iv) the risk of market foreclosure and supplier lock-in. Our study contributes to the literature on incentives in demand-side innovation policy by tapping into the contractual design features and by offering relevant implications for academics and policy-makers.

Date: 2018
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Working Paper: Pre-commercial Procurement, Procurement of Innovative Solutions and Innovation Partnerships in the EU: Rationale and Strategy (2016)
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DOI: 10.1080/10438599.2017.1402431

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