Can small states induce innovation through public procurement? Survey of Estonian public sector suppliers and implications for further policy-making

Public procurement of innovation (PPI) is expected to play a central role for governments in delivering better public services, increasing the overall productivity of public sector and spur innovation in private firms. Many... [ view full abstract ]

Public procurement of innovation (PPI) is expected to play a central role for governments in delivering better public services, increasing the overall productivity of public sector and spur innovation in private firms. Many governments around the globe – from Australia and China to Brazil and European Union member countries – have recently initiated new PPI policies. There is a considerable global policy transfer and learning taking place where governments try to emulate from international best practices. Yet, most of these policy best practices come from large countries with considerably idiosyncratic institutional and market settings. This makes it questionable to what extent small counties can emulate PPI policies from other, especially large countries. By drawing on a firm-level survey from Estonia (n: 527), the current paper gives a detailed account of specific small country challenges with regard to PPI, and analyzes the implications for PPI policy design and strategies in small states.