Data procurement and market power in the Dutch public sector: How to become a stronger buyer

Abstract

Governments around the world are actively exploring how they can tackle societal problems through data-driven decision-making. As much data is now in the hands of the private sector, governments increasingly resort to purchasing data from private sources. There is, however, scant empirical evidence and a lack of understanding of the experiences of governments with this practice. This study therefore asks the following questions: how do governments purchase data from the private sector and what challenges do they encounter in the process? We conducted an exploratory multiple case study based on sixteen interviews with seven governments in the Netherlands focusing on use cases in the mobility or spatial domains. Our analysis covers, among other things, the purpose of the purchases and to what extent alternatives and joint procurement were considered, the purchasing procedures and respective market characteristics, and the governments' assessment and satisfaction with the purchases. We identify a number of challenges that are associated with data procurement. Our conclusions highlight three priorities to strengthen the position of governments as buyers of data: the need to balance competing priorities, the need to understand how dependency and lock-in emerges, and the need to expand assessments to public values.