Table Of ContentPUBLIC TECHNOLOGY PROCUREMENT AND INNOVATION
Economics of Science, Technology and Innovation
VOLUME 16
Series Editors
Cristiano Antonelli, University o/Torino, Italy
Bo Carlsson, Case Western Reserve University, US.A.
Editorial Board:
Steven Klepper, Carnegie Mellon University, USA.
Richard Langlois, University o/Connecticut, USA.
lS. Metcalfe, University 0/ Manchester, UK.
David Mowery, University o/California, Berkeley, USA.
Pascal Petit, CEPR EMAP, France
Luc Soete, Maastricht University, The Netherlands
The titles published in this series are listed at the end oft his volume.
PUBLIC TECHNOLOGY
PROCUREMENT AND
INNOVATION
Edited by:
Charles Edquist, Leif Hommen and Lena Tsipouri
"~.
SPRINGER SCIENCE+BUSINESS MEDIA, LLC
Library of Congress Cataloging-in-Publication Data
Public technology procurement and innovation / edited by Charles Edquist, Lief
Hommen, and Lena Tsipouri.
p.cm.--(Economics of science, technology, and innovation ; v. 16)
ISBN 978-1-4613-7084-0 ISBN 978-1-4615-4611-5 (eBook)
DOI 10.1007/978-1-4615-4611-5
1. Technological innovations--Government policy--Sweden.2. Technological
innovations--Government policy--European Union countries.3.Government
purchasing--Sweden.4.Government purchasing--European Union countries.
I.Edquist, Charles, 1947-II.Hommen, Leif.ill.Tsipouri,Lena J., 1953-IV.
Series.
HC380.T4 P83 1999
338' .0644'09485--dc21 99-046682
Copyright <C 2000 Springer Science+Business Media New York
Originally published by Kluwer Academic Publishers, New York in 2000
Softcover reprint of the hardcover 1s t edition 2000
All rights reserved. No part of this publication may be reproduced, stored in
a retrieval system or transmitted in any form or by any means, mechanical,
photo-copying, recording, or otherwise, without the prior written permission of
the publisher, Springer Science+Business Media, LLC.
Printed on acid-free pap er.
CONTENTS
List of Contributors .................................................................................................................. ix
Preface ...................................................................................................................................... xi
Introduction - C. Edquist, L. Hammen and L. Tsipouri
1. Systems of Innovation: A Demand-Side Approach ............................................................... 1
2. Theoretical, Conceptual, and Policy Issues ........................................................................... 2
References ................................................................................................................................. 4
1. Public Technology Procurement and Innovation Theory
- C. Edquist and L. Hommen
1. Introduction ........................................................................................................................... 5
2. Different Kinds of Public Technology Procurement ........................................................... 20
3. Technology Procurement in Context: Aspects of the 'Demand Side' ................................. 27
4. Public Technology Procurement Revisited .......................................................................... 51
5. Summary ............................................................................................................................. 63
References ............................................................................................................................... 64
Overview of Case Studies - C. Edquist, L. Hammen and L. Tsipouri
Introduction ............................................................................................................................. 71
1. Selection of Cases ............................................................................................................... 71
2. Generalisation from Case Studies ....................................................................................... 73
3. Synopsis of the Cases .......................................................................................................... 74
References ............................................................................................................................... 78
2. Public Technology Procurement in Sweden: The X2000 High Speed Train
- C. Edquist, P. Hammarqvist and L. Hommen
Introduction ............................................................................................................................. 79
1. Industrial Policy .................................................................................................................. 81
2. Innovation Policy ................................................................................................................ 87
3. Costs, Benefits & Profits ..................................................................................................... 90
4. Main Conclusions ................................................................................................................ 92
vi
5. Policy Implications .............................................................................................................. 94
Interviews ................................................................................................................................ 97
References ............................................................................................................................... 97
3. Procuring Products and Power: Developing International Competitiveness
in Swedish Electrotechnology and Electric Power - M. Fridlund
1. Introduction ........................................................................................................ ,. ............... 99
2. Proto-Procurement: In Search of Power and Products ...................................................... 100
3. Procurement: HYDC in the Making .... .... ...... .... .... .... .... ....... ..... ....... ............ .... .... .... ......... 107
4. Post-Procurement: Re-Making Products and Power ......................................................... 114
5. Conclusions: Private and Public Competitiveness ............................................................ 115
References ........ .... ... .... ........... ..... ..... ........ .......... ............ ......... ... .... ......... ............. ... .... .......... 117
4. A Case Study of the Swedish Public Technology Procurement Project
"The Computer in the School" (COMPIS), 1981-1988 - T. Kaiserfeld
1. Introduction ....................................................................................................................... 121
2. Interaction Environment .................................................................................................... 123
3. Competence and User-Producer Interaction ...................................................................... 126
4. Political Influence and Levels of Intervention .................................................................. 132
5. The Dimension of Time ..................................................................................................... 135
6. Conclusions ....................................................................................................................... 137
References ............................................................................................................................. 139
5. Switching Relations and Trajectories: The Development Procurement of the
AXE Swedish Switching Technology - M. Fridlund
1. Introduction ....................................................................................................................... 143
2. An Outline of the Swedish Telephone System, 1920-1980 .............................................. 144
3. Proto-Procurement: Learning Switching Trajectories, 1952-69 ........................................ 149
4. Procurement: Developing Trajectories, 1970-77 ............................................................... 154
5. Post-Procurement: Adapting Trajectories, 1973-81 .......................................................... 161
6. Results: Switching Advantages ......................................................................................... 163
References ............................................................................................................................. 164
vii
6. Industrial Transformation through Public Technology Procurement?
The Case of Nokia and the Finnish Telecommunications Industry
- C. Palmberg
I. Technology Policy and Procurement in Finland ................................................................ 167
2. The Finnish Telecommunications Sector .......................................................................... 168
3. The DX 200 Switching System
- Nokia's Platform Technology ....................................................................................... 173
4. Standardisation and Procurement - Developing network equipment for the NMT .......... 178
5. Structural Tensions in the Finnish Telecommunications Sector - The History Revisited. 187
6. Conclusions .................................... '" ............................................................................... 193
References ................................................................................................... ......................... 194
7. Public Technology Procurement: The Case of Digital Switching Systems
in France - P. Llerena, M. Matt and S. Trenti
Introduction ........ ........... ........................................................................................................ 197
1. The French Telecommunication Sector .................... , ........................................................ 197
2. The NSI and the Telecommunication Policy ................................................................... ,. 203
3. The Role of Public Procurement and the Digital Switching System ................................ 206
4. Appraisal of Societal and Industrial Results and Conclusion ........................................... 211
References ............................................................................................................................ 215
8. Public Technology Procurement: The Case of Digital Switching Systems
in Italy - P. Llerena, M. Matt and S. Trenti
Introduction ........................................................................................................................... 217
1. The Italian Telecommunication Sector .............................................................................. 217
2. The NSI and the Telecommunication Policy ..................................................................... 224
3. The Role of Public Procurement and the Digital Switching System ................................. 228
4. Appraisal of Societal and Industrial Results and Conclusion ............................................ 233
References ........................................................................................................................... 238
9. Public Technology Procurement: The Case of Digital Switching Systems
in Greece - L. Tsipouri
I. Introduction ....................................................................................................................... 241
2. The Institutional Framework ............................................................................................. 247
viii
3. The Key Organisations Involved ....................................................................................... 248
4. Organisation and Management of the Procurement Process ............................................. 252
5. Appraisal Of Societal and Industrial Results and Policy Aspects ..................................... 254
6. Summary And Conclusions ............................................................................................... 257
References ............................................................................................................................. 258
10. On Implementing the Austrian Computerised Digital Switching
System (OES) - M. Husz
1. Introduction ...... '" .............................................................................................................. 259
2. The Austrian Telecom Sector ............................................................................................ 260
3. The Decision Process ........................................................................................................ 264
4. The Implementation Process ............................................................................................. 269
5. Appraisal of Societal and Industrial Results ...................................................................... 275
6. Conclusions ....................................................................................................................... 277
Appendix: List of Abbreviations .......................................................................................... 279
References ....................................... '" ................................................................................... 279
11. Analysis, Findings and Conclusions
- C. Edquist, L. Hommen and L. Tsipouri
Introduction ........................................................................................................................... 281
1. Analytic Framework .......................................................................................................... 281
2. Analytic Strategy ............................................................................................................... 285
3. Summary of Findings ........................................................................................................ 287
4. Conclusions ....................................................................................................................... 297
References ............................................................................................................................. 299
12. Policy Implications - C. Edquist, L. Hommen and L. Tsipouri
1. Introduction ....................................................................................................................... 301
2. Alternative Approaches to Public Technology Procurement Policies ............................... 302
3. A Framework For Policy Orientation ................................................................................ 304
4. Competition Rules, Legal Issues and the EU Framework ................................................. 307
5. Concluding Remarks: Towards New Legislation or New Informal Rules? ...................... 310
References ............................................................................................................................. 311
LIST OF CONTRIBUTORS
Charles Edquist - Professor, Department of Technology and Social Change,
University of Linkoping, Sweden.
Mats Fridlund - Researcher, Department of History of Technology, Royal
Institute of Technology (KTH), Stockholm, Sweden.
Per Hammarqvist - Former research assistant, Department of Technology and
Social Change, University of Linkoping, Sweden. Currently a consultant with Cap
Gemini, Stockholm, Sweden.
LeifHommen - Researcher, Department of Technology and Social Change,
University of Linko ping, Sweden.
Martin Husz - Former researcher, Department of Technology Studies, Austrian
Research Centre, Seibersdorf, Vienna, Austria. Currently an independent entrepre
neur in Vienna, Austria.
Thomas Kaiserfeld - Researcher, Department of History of Technology, Royal
Institute of Technology (KTH), Stockholm, Sweden.
Patrick Llerena - Professor, Bureau d'Economie Theorique et Appliquee
(BETA), Louis Pasteur University, Strasbourg, France.
Mireille Matt - Researcher, Bureau d'Economie Theorique et Appliquee (BETA),
Louis Pasteur University, Strasbourg, France.
Christopher Palmberg - Researcher, Group for Technology Studies, Technical
Research Centre of Finland (VTT), Helsinki, Finland.
Stefania Trenti - Former researcher, Bureau d'Economie Theorique et Appliquee
(BET A), Louis Pasteur University, Strasbourg, France. Currently a doctoral candi
date in the Institute of Political Economy, Bocconi University, Milan, Italy.
Lena Tsipouri - Professor, Centre for Financial Studies, University of Athens,
Greece.
PREFACE
This book studies public technology procurement as an instrument of innovation pol
icy. In the past few years, public technology procurement has been a relatively neglected
topic in the theoretical and research literature on the economics of innovation. Simi
larly, a preoccupation with 'supply-side' measures has led policy-makers to avoid
making very extensive use of this important 'demand-side' instrument. These trends
have been especially pronounced in the European Union. There, (as will be argued in
this book) existing legislation governing public procurement presents obstacles to the
use of public technology procurement as a means of stimulating and supporting tech
nological innovation. Recently, however, there has been a gradual re-awakening of
practical interest in such measures among policy-makers in the EU and elsewhere. For
these and other, related reasons, this volume is meant to contribute to a serious recon
sideration of public technology procurement from the complementary standpoints of
innovation theory and innovation policy.
The book originates from studies initially planned and carried out as a sub-project
of the Innovation Systems and European Integration (ISE) research project, which ran
from 1996 to 1998. ISE was supported by the European Commission (EC), through
funding for Targeted Socio-Economic Research (TSER) provided under the EC' s Fourth
Framework Programme (Contract no. SOEI-CT95-1004 DG XII SOLS). Charles
Edquist was coordinator of both ISE and its empirical sub-project on Public Technol
ogy Procurement as an Innovation Policy Instrument. ISE involved nine research groups
in nine European countries. It had the overall purpose of elaborating the Systems of
Innovation approach with respect to: 1) evaluating this new understanding of the de
velopment of science, technology, innovation and the implications thereoffor economic
growth and employment; and 2) developing new policy options and implications on
this basis. The empirical sub-project on Public Technology Procurement was particu
larly successful in fulfilling these purposes. This volume reflects the sub-project's
achievements in responding constructively to difficult theoretical issues and policy
problems with conclusions based on well-researched empirical evidence.
As editors of this book, we would like to acknowledge and thank a number ofpeo
pIe. We are, of course, indebted to the European Commission for the funding which
made our research possible. The authors who have contributed to this book, and who
were also participants in the ISE sub-project on Public Technology Procurement, de
serve special mention and thanks for their co-operation in what was truly a collective
research effort. In addition, we owe a debt of gratitude to all of our other colleagues in
ISE, from whose collegial advice and assistance we were able to benefit. We are also
grateful to Simon Ivarsson, Fram;:ois Texier, and other members of the Department of
Technology and Social Change at the University of Linkoping, who lent us valuable
assistance in producing this book.
Charles Edquist and LeifHommen Lena Tsipouri
LinkOping, Sweden, 1999 Athens, Greece, 1999
