Iranian Association for Management of Technology Journal of Science and Technology Policy 20080840 12 2 2019 06 22 Demand-Side Innovation Policies, with an Emphasis on Public Procurement for Innovation (PPI) Demand-Side Innovation Policies, with an Emphasis on Public Procurement for Innovation (PPI) 481 494 13714 FA Najmoddin Yazdi Researcher, Sharif Policy Research Institute (SPRI), Sharif University of Technology, Tehran, Iran Ali Maleki Faculty Member, Sharif Policy Research Institute (SPRI), Sharif University of Technology, Tehran, Iran Journal Article 2019 08 13 Innovation policies are in general categorised into demand-side and supply-side. Despite a long tradition of discussing their importance, demand-side innovation policies have been out of the focus of innovation policy scholars and policy-makers. Demand affects innovation through four mechanisms: Changes in demand can spur gradual and path-dependent innovations; Sensitivity of demand to innovations triggered from the supply-side could ultimately stimulate cycles of new demands; Demand of users can impact innovation features through cooperative production of innovation by users and producers; and Users may modify purchased innovations according to their specific needs. Rationales for demand-side policymaking could be categorised into three: Overcoming market and system failures; Spurring economic growth; and Market transformation for societal goals. In a taxonomy, these policies are classified as: Supporting public and governmental demand; Supporting private demand; and Systemic approaches. The first category and specifically the policy of Public Procurement of Innovation (PPI) are one of the most direct and used policies in the demand side. In this policy, states act as a lead market, leverage public demand and procure innovative products and services instead of routine ones to stimulate further innovation demand. Innovation policies are in general categorised into demand-side and supply-side. Despite a long tradition of discussing their importance, demand-side innovation policies have been out of the focus of innovation policy scholars and policy-makers. Demand affects innovation through four mechanisms: Changes in demand can spur gradual and path-dependent innovations; Sensitivity of demand to innovations triggered from the supply-side could ultimately stimulate cycles of new demands; Demand of users can impact innovation features through cooperative production of innovation by users and producers; and Users may modify purchased innovations according to their specific needs. Rationales for demand-side policymaking could be categorised into three: Overcoming market and system failures; Spurring economic growth; and Market transformation for societal goals. In a taxonomy, these policies are classified as: Supporting public and governmental demand; Supporting private demand; and Systemic approaches. The first category and specifically the policy of Public Procurement of Innovation (PPI) are one of the most direct and used policies in the demand side. In this policy, states act as a lead market, leverage public demand and procure innovative products and services instead of routine ones to stimulate further innovation demand. https://jstp.nrisp.ac.ir/article_13714_209e84a7c013720b8d636c1b58bcb1b9.pdf