Demand driven innovation policy by forward public procurement: the Italian aerospace industry case

This proceeding paper focuses at the current debate on forward public procurement (fpp) as a powerful tool for refocusing private R&D investments towards innovative activities suitable of improving commercial and social impact of hightechnologies. Fpp provides the market with advance information of future needs in outcome terms creating market opportunities for entrepreneurs. Here I suggest the analysis of a case study that could enlarge the knowledge about how this mechanism works and what its "best practice" could be. As well, I argue it can be an efficient tool for European policymakers facing the current debt crisis and the reform of the Lisbon agenda in order to reduce public spending policies. Public procurement gained attention in Europe because of the privatization program requested by the European integration process. Indeed, during the 80s, the Italian Government, along with other European countries, ended direct intervention in economy in most of its former Stateholdings. However, it was able to sustain a typical Government related business such as aerospace by the establishment of a public institution, the Italian Aerospace Agency (ASI) in 1988. The first stage of my research shows that the ASI policy of public procurement was able to drive the technological effort of the main Italian aerospace company and former Stateowned, Finmeccanica, towards a rationalization of the industry at the national level and greater technological competitiveness. Finally, the tool has allowed the space subsidiary of Finmeccanica, Alenia, to join with French company Thales space division in a European leading actor on the global market for the hightechnologies.