Risk management in public procurement for innovation: the case of Nordic–Baltic Sea cities

Abstract

State support for innovation in enterprises has been long-standing. One of the specific support measures is public procurement for innovation, which has only recently re-emerged in academic discussion as well as in the European policy discourse. While the spillovers from this type of innovation policy measure may be substantial, the complex processes underlying the support for innovation through public procurement are associated with high risks. We take an exploratory approach to determine the state of practice of risk management in public procurement for innovation at the local level. Five case studies, which were selected as representative cases of the Nordic–Baltic Sea region in Europe, were analyzed. We found that the cities were, for the most part, actively involved in risk identification; the risks are primarily being met with mixed contracting strategies rather than comprehensive risk management tools.