Demand-side Innovation Policies

image of Demand-side Innovation Policies

Demand-side innovation policies have been receiving increasing interest from a number of OECD countries in recent years in the context of slow growth and lagging productivity performance. Pressures on fiscal budgets in the aftermath of the financial crisis have also motivated governments to seek ways to boost innovation without necessarily engaging in new programme spending, primarily to meet social demands in areas such as health, energy or the environment.

This book examines dynamics between demand and innovation and provides insights into the rationale and scope for public policies to foster demand for innovation. It shows the potential - but also the limits - of using public procurement, regulations or standards to stimulate public and private demand for innovation, including among SMEs. Drawing on country experience and case studies, this report illustrates good practices for designing, implementing and evaluating demand-side innovation policies.

English Also available in: Chinese


In the context of lagging innovation and productivity performance, policy makers seeking to boost innovation are increasingly looking beyond traditional supply-side policies such as R&D support to demand side in order to accelerate innovation. Many OECD countries are using public procurement, regulation, standards and lead market initiatives as well as consumer policies and user-led innovation initiatives to stimulate innovation. They are not alone in so doing, as emerging economies such as China and Brazil have recently implemented more targeted demand-side innovation policies, notably in areas where societal needs are high and not met by market mechanisms alone. This report draws both on the theoretical and empirical literature as well as country experience to provide insights and examples of good practice policies to increase demand for innovation and thus enhance productivity and growth.


This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error