Iossa E., Biagi F., Valbonesi P. (2018).
Pre-commercial Procurement, Procurement of Innovative Solutions and Innovation Partnerships in the EU: Rationale and Strategy. Economics of Innovation and New Technology, Vol. 27, No. 8, pp. 730-749.
We discuss public procurement instruments for acquiring innovation, focusing on the European Precommercial Procurement, Procurement of Innovative Solutions and Innovation Partnerships. We analyse in particular how the firms’ innovation incentives are affected by: (i) economies of scope and externalities between R&D and large-scale production; (ii) degree of specificity of the innovation; (iii) presence of Small and Medium Enterprises (SMEs) in the market and level of market competition; (iv) 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.