Historical Analysis of Implementing Challenges of Public Procurement for Innovation (PPI) Policies in Iran

The role of public procurement for innovation as a demand-push policies has been considered by policymakers in recent decades, especially in developed countries. In order to study the historical analysis about the evolution of these policies in Iran, several cases of horizontal and vertical policies are studied and compared in this research. The most important policy of these has been implemented and evolved since 1996 with the approval of the law on maximum use of local production and services capacity. In this study, for horizontal policies, law on maximum use of local production and services capacity (approved in 1996, 2012 and 2019) and law of foreign financing facilities (approved by the Economic Council in the period 2011 to 2020); And from the vertical perspective, the program of supplying 10 basic equipment in Oil Industry (implemented in 2015) and the exhibition made in Iran (beginning of implementation in 2012) are selected. These four policy programs are analyzed and compared based on the framework of PPI. Examining the evolution of this policy tools shows that demand transparency based on the priorities of different sectors, identification, evaluation and promotion of internal capacity, intermediary institutions (for exchange cost management) and governance system, to develop sector innovations are the four most important common challenges. The findings of this study indicate the repetition of policy challenges and shortcomings in the process of diversification and the evolution of horizontal and vertical policy programs of public procurement supporting innovation in Iran, which is suggested to be considered in future policy efforts.