Public procurement, innovation and industrial policy: Rationales, roles, capabilities and implementation

Recent thinking about innovation and industrial policy emphasises purposeful related diversification strategies or more transformative—but potentially riskier—challenge-orientated policies. Meanwhile public procurement is increasingly seen as a key means of fostering innovation. We conceptualize the multiple roles of public procurement in an innovation policy landscape shaped by these emerging rationales, and explore the complexities and institutional work associated with its implementation. We identify some possible roles for government in fostering diversification and transformation through public procurement and explore the implementation challenges of institutionalising public procurement as part of innovation policy. Both the multiple potential roles of public procurement and the institutional work associated with its implementation are illustrated with the case of Galicia, Spain.