Government Levers for Sustainable Industrial Policy: Strategic Procurement and Training Programs

Governments shape markets through a variety of mechanisms: by regulating industries, providing incentives, setting standards, and acting as major buyers of goods and services. They also influence outcomes indirectly by investing in human capital and capabilities. This thesis focuses on two of these levers for industrial policy: sustainable public procurement, which alters demand-side incentives, and training programs, which build supply-side capacity. The first chapter examines how the inclusion of sustainability considerations in public tenders affects competition and prices. Using Spain as a case study and exploiting a major pro-sustainability regulatory reform, the chapter shows that introducing sustainability criteria changes bidder behavior, leading to fewer participants. It also provides suggestive evidence of higher procurement costs associated with this practice. The second chapter continues with the Spanish case study but shifts the focus from auctions to firms. Linking procurement records with firm-level data, it investigates how firms winning contracts that include sustainability considerations evolve after the award. The chapter documents growth gaps between firms winning sustainable contracts and those winning standard ones. These differences appear to be driven by implementation inexperience. The third chapter shifts the lens from market-shaping to capability-building, evaluating two training programs run by the City of Buenos Aires. The chapter exploits a centralized assignment mechanism to estimate causal impacts. It finds substantial gains in course-related knowledge and behavioral changes consistent with program objectives. Beyond policy results, it provides practical guidance for evaluators working with centralized assignment at smaller scales, comparing alternative estimators and documenting trade-offs in bias and precision using simulations