Effectiveness of public procurement of innovation versus supply-side innovation measures in manufacturing and services

Radicic, Dragana (2019) Effectiveness of public procurement of innovation versus supply-side innovation measures in manufacturing and services. Science and Public Policy . ISSN 0302-3427

Full content URL: http://doi.org/10.1093/scipol/scz026

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Effectiveness of public procurement of innovation versus supply-side innovation measures in manufacturing and services
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Abstract

Most quantitative evaluations report positive but small effects of supply-side innovation measures. Although the literature suggests that demand-side measures, in particular, public procurement of innovation, might be more effective in stimulating innovation than supply-side measures, empirical evidence on this proposition is scarce. To empirically test this proposition, we utilize the Eurobarometer 2014 survey to estimate the effects from public procurement of innovation as well as from the supply-side innovation measures on product and process innovations in manufacturing and service firms in the US and Europe. Our findings suggest that the treatment effects of public procurement of innovation are indeed larger than the effects of supply-side public support on product innovation in both manufacturing and service sectors. This finding also holds for process innovation, but only in the service sector. In contrast, in manufacturing firms, the estimated effects on process innovation are only positive and significant in firms receiving public support.

Keywords:Public procurement of innovation, Product and process innovations, Quantitative evaluation, Supply-side innovation measures
Subjects:N Business and Administrative studies > N110 European Business studies
Divisions:Lincoln International Business School
ID Code:35851
Deposited On:07 May 2019 08:34

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