Knowledge that Transforms

Interest in public procurement's role in innovation has been reinforced by the directional turn in innovation policy, which highlights the social purpose of innovation. Procurement-induced innovation may often be a by-product of the pursuit of other policy goals, especially in sectors that are highly dependent on innovation, such as healthcare. Yet the tendency of innovation scholarship to focus at macro-levels, and on R&D-intensive innovation, means that the ways in which procurement routinely affects innovation – whether positively or negatively – are not fully understood. A particular scholarly lacuna relates to the role of the procurement office, which is often characterized as a more-or-less effective conduit for the knowledge and imperatives of others, notably users and vendors. Literature from innovation policy studies, which highlights the importance of implementation and administration for realizing innovation policy aims, alongside the burgeoning field of valuation studies, suggests that these offices may have a more substantive effect. We explored the role of the procurement office in innovation in the healthcare sector, which is highly dependent on innovation but retains the delivery of a high quality public service as its primary goal. We used an embedded case study design across four provinces in Canada, involving document review, ethnographic observation and key informant interviews (n=32). We first review how procurement offices engage and shape markets, then turn to the critical ways in which this market-shaping capacity is enabled through demand shaping activities that are negotiated within health systems. We argue that procurement offices act as professional intermediaries wielding calculative devices to set up the parameters of purchasing situations and to render certain measures of worth calculable through purchasing specifications. In doing so, they configure demand, conjure supply, and shape markets over time. Thus, they have a systemic impact on innovation. Yet while always present, the strength of the procurement office's impact is not unlimited, being constrained by powerful constituencies within health systems and cost-cutting pressures placed on public sector procurement more generally. We suggest that acknowledging the substantive importance of procurement offices in innovation may be an important first step in unleashing their capacity to support it.

We evaluate whether public research subsidies are complements or substitutes to the private R&D spending of large firms. Combining data on the EC’s three most recent Framework Programmes (FP6, FP7 and H2020) with data on the world’s largest research companies, we use matching and difference-in-difference estimation to compute the causal impact of subsidies on private R&D spending. While, on average, subsidies have not led to increased private research budgets, we identify policy-relevant heterogeneities, finding that subsidies increased own R&D for smaller firms and projects as well as more R&D-intensive firms. We also find that Horizon 2020 successfully stimulated firms’ private R&D spending, while its predecessors did not.

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.

Recent literature has turned considerable attention to the role of policy mixes in shaping socio-technical systems towards sustainability. However, the identification of relevant policy intervention points has remained a relatively neglected topic. This is a potentially significant oversight given that such intervention points constitute a mid-step between means (particular policy instruments) and overall goals (change in the directionality of socio-technical systems). By complementing existing work on policy mixes with additional insights from transitions literature, this paper formulates a conceptual framework of six policy intervention points for transformative systems change. The coding scheme developed on the basis of this framework is used to review current literature on policy mixes in sustainability transitions. It is shown that the latter has so far primarily focused on niche-regime dynamics while largely neglecting the broader context of these interactions. We argue that adopting a wider perspective on intervention points can aid future work on policy mixes by enabling the identification of root causes and critical problems of ongoing transitions, and to spot gaps in existing policy activities. The case of the Estonian energy system is used to briefly illustrate these possibilities. Methodologically, we demonstrate the value of combining theory-based concept-formation with a systematic literature review, enabling not only a provision of a summary of existing literature but also highlighting systematic gaps in that literature.

Eco-innovation (EI) is a complex process that involves product, process, organizational and marketing dimensions, each with its own determinants, characteristics and contributions to environmental business performance. Thus, analyzing EI activity is essential to obtaining a holistic view in order to achieve sustainable development. This study offers a multidimensional EI measurement and, what is more, evaluates its relationship with environmental corporate culture and commercial orientation drivers in a high environmental impact context, i.e., the agri-food sector. The proposed model was tested using the partial least-squares technique, which was applied to data collected from a sample of 93 companies located in southeast Spain. This study confirms the importance of several dimensions, namely marketing, organization and process, to corporate adoption of EI. Additionally, this research also reveals the positive relationship that both drivers, environmental corporate culture and commercial orientation, have with EI. The findings also suggest that theorists and practitioners must contemplate EI from the point of view of its four dimensions in order to achieve an efficient, more realistic analysis. Subsequently, this work carries some theoretical conclusions and implications for research and practice.

University education is a crucial source of human capital and influences graduates’ choice of entrepreneurship as a career. Here, we discuss the contrasting effects on recent graduates’ entrepreneurial entry of the type and quality of the human capital developed through university education in STEM fields. We determine which effects prevail by examining the graduates who obtained a Master of Science degree in the period 2005–2009 from Politecnico di Milano. A university curriculum specialized into a limited number of scientific and technical fields, training in economics and management, and the scientific quality of the university in the research fields pertinent to the graduate's degree programme are positively associated with entrepreneurial entry immediately after graduation, while the graduation grade is not. The graduation grade and the scientific quality of the university positively moderate the impact of curriculum specialization. These effects weaken over time, but are still relevant five years after graduation.

Seeking to obtain efficiency in the development and integration of knowledge about R&D and corporate social responsibility (CSR), firms face hard choices about their resource allocation to these two areas because of the specialized nature of knowledge and related barriers to integration. We address this organizational resource allocation dilemma by relaxing the common assumption that firms are either responsible or irresponsible and examining financial slack as a possible moderator. Using a multicountry sample of 1,957 firms over a 16-year timespan, we find strong empirical support for the positive association between firms' R&D intensity and CSR specialization, a novel concept that-distinct from CSR as such-gauges the extent to which firms specialize in specific environmental, social, or governance aspects of CSR. However, there is insufficient support for financial slack as a moderator in general (except for one noteworthy industry pattern and an alternative operationalization of slack). The exceptions suggest that the nature of organizational slack may influence the relationship between R&D and CSR specialization.

We adopt an organizational learning approach to examine how firms’ recruitment of high-skilled migrants contributes to subsequent firm-level innovation performance. We argue that due to migrants’ often different experience from that of native high-skilled workers, their perspectives on problem-solving and access to non-overlapping knowledge networks will also differ. The implied complementarity between these worker types makes migrant hires a particularly valuable resource in the context of firm-level innovation. We refine our diversity hypothesis further by predicting that migrant hires who add to the firm's cultural diversity should contribute more to firm innovation performance than new high-skilled migrant hires who do not add cultural diversity. Finally, we conjecture that firms with high integration capacity as a function of prior experience of employing high-skilled migrants should derive more innovation-related benefits from migrant hiring than firms with a low integration capacity. We track the inward mobility of high-skilled workers empirically using patents and matched employer-employee data for 16,241 Dutch firms over an 11-year period. We find support for our hypotheses.

To promote economic growth and overcome societal challenges, policy-makers often try to shape an entrepreneurial ecosystem (EE) that will facilitate technological entrepreneurship. An EE consists of a knowledge subsystem and a business subsystem, which are often unconnected. A financial support network (FSN) consisting of startups and private venture capitalists can bridge two subsystems and thus enable critical technology transfer in EEs. These FSNs remain underdeveloped in many European regions, however; the literature on innovation systems refers to this lack of connectivity as a “weak network problem.” While incubators can function as intermediaries to overcome such weak network problems, how they do so is poorly understood. This research thus poses the following research question: What is the effect of incubators’ support mechanisms on the occurrence of weak network problems in entrepreneurial ecosystems? We develop a theoretical model in which network development is a function of two processes: “meeting” and “mating.” We argue how different incubator support mechanisms influence these two processes; we then apply these insights in an agent-based model, which allows for estimating how much each support mechanism contributes to overcoming weak network problems in the FSN. Our simulation shows that developing a strong network among startups is key to overcoming weak network problems in FSNs. The most effective way to do so is to introduce incubated startups to non-incubated startups through field-building. Our results provide new theoretical insights into how networks in EEs and innovation systems develop, and what role incubators play as intermediaries in this process. The systemic benefits of incubators also greatly enhance their societal value proposition.

Public research funding programs typically make grants with minimal intervention by program staff, rather than using a hands-on approach to project management, which is more common in the private sector. In contrast, program staff at the US Department of Energy's Advanced Research Projects Agency – Energy (ARPA-E) are given a set of real options with which to manage funded projects: abandon, contract or expand project budgets or timelines. Using internal data from ARPA-E, we show that active project management enables risk mitigation across a portfolio of research projects. We find that program staff modify projects frequently, especially project timelines, and these changes are more sensitive to poor performance than to strong performance. We also find that projects with a shortened timeline or reduced budget are less likely to generate short-term research outputs, compared to those of ultimately similar size. This evidence suggests that the practice of active project management, when combined with high upfront risk tolerance, can be used to enhance the productivity of mission-oriented public research funding.