Promoting SMEs friendly public procurement (SFPP) practice in developing country: The regulation and policy motivator and beyond

Abstract

SMEs friendly public procurement (SFPP) has been regarded as an important policy tool for promoting SMEs. Meanwhile, the motivation of regulations and policies for SFPP has been extensively recognized. The influence mechanism hidden in this motivation relationship, however, remains an important research gap. In order to seek a better understanding for this issue, we develop a conceptual model based on institutional theory, stakeholder theory, and upper echelons theory from the perspective of public sectors to explain SFPP practice and reveal this black box. Analyzing data collected from 106 Chinese local public sectors, we find that regulation and policy motivator is positively associated with SFPP practice of public sectors. And further research suggests that nongovernmental stakeholders have a positive moderation effect on this relationship. Additionally, we find that top management commitment boasts partial mediation on this relationship. This study helps academia better understand what factors influence the SFPP practice and how it is influenced. The implications are also valuable to policymakers and public sector managers.

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