Social Goals in Public Procurement: Regulatory Complements or Compensation for Welfare States?

States can pursue social goals beyond social policy by regulating markets. However, the degree to which they do so differs over time and across countries. In public procurement regulation the state can either decide to spend money on the basis of a pure cost-benefit analysis or by including social criteria. When and why does the state seek social goals e.g. via the prescription of minimum wages, working conditions or a duty to employ those disfavoured on the labour market? Theoretically both the Varieties of Capitalism literature and scholars interested in the emergence and institutional configuration of welfare states leave us to expect that regulation in the social and economic sphere are complements, because both are likely to be influenced by the same actors, processes and institutions and/ or for reasons of institutional complementarity. This contrasts with Majone who stresses that regulatory instruments are formulated by a different type of (non-majoritarian) actors, such as administrations and agencies, and follow a much more technocratic than political logic. From this latter perspective we should expect that economic regulation seeking social goals has the potential to compensate for social policy that is weak or blocked by political contestation. The paper compares public procurement regulation in France, Germany and the USA over the last ca. 40 years to shed light on the explanatory power of these theoretical expectations. It is part of a broader multiannual project that (quantitatively and qualitatively) studies different regulatory instruments seeking social goals in the OECD world.