Buying to Develop: The Experience of Brazil and China in Using Public Procurement to Drive Innovation

Yanchao Li (), Cássio Garcia Ribeiro, André Tortato Rauen () and Edmundo Inácio Júnior ()
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Yanchao Li: Finance, Competitiveness and Innovation Global Practice, World Bank, Washington, District of Columbia, USA
Cássio Garcia Ribeiro: #x2020;Institute of Economics and International Relations - IERI, Federal University of Uberlândia - UFU, Uberlândia, Minas Gerais, Brazil
André Tortato Rauen: #x2021;Institute of Applied Economic Research - IPEA, Brasilia, District Federal, Brazil
Edmundo Inácio Júnior: #xA7;School of Applied Sciences, University of Campinas - UNICAMP, Limeira, Sao Paulo, Brazil

International Journal of Innovation and Technology Management (IJITM), 2020, vol. 17, issue 03, 1-32

Abstract: This paper sets out to understand the use of public procurement as a policy instrument for catching up. Brazil and China, who have explicitly linked procurement to innovation, are used as empirical cases. We review their respective institutional settings, policy approaches, and micro-level processes related to the public procurement of innovation (PPI). We have discovered that they share similarities concerning issues encountered during PPI implementation. Although both countries have made some achievements in promoting innovation through procurement, this paper highlights some of the obstacles they have experienced when implementing this policy, such as institutional problems, changes in the political landscape, and macroeconomic constraints. Such obstacles, more prominent in the case of Brazil, may have acted as an obstruction to achieving the pursued objectives, thereby restricting the full potential of PPI in driving technological catching up. The article then offers managerial and policy implications for the implementation of PPI, such as the importance of choosing relevant procurement procedures, critical roles played by policy champions, and demonstrating effects of leading firms and regions. While in China PPI was once an instrumental part of its technology development agenda, in Brazil it has been sporadic and unconnected to a given national strategy.

Keywords: Public procurement; innovation; development; policy; catch-up; Brazil; China (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1142/S0219877020500212

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