This paper sets out to examine the innovative capacity of the European Union countries and regions vis-à-vis educational attainment and economic development, as it is frequently stated that innovation and
IntroductionThe European Union (EU) enlarged to include 27 countries in 2007. The new member states broadened the national and regional diversities within the Union, and this paper sets out to explore the causal relations between innovative capacity, educational attainment and economic condition in the enlarged EU. Gössling and Rutten (2007) state that a vital, if not the only, driver of economic growth is the link between innovations and economic development. This notion is bidirectional: innovation creates economic development and a certain stage of economic development is needed to produce innovations. However, the paper is motivated by Strulik's (2005) statement that while economic growth is explained through innovation, it is ultimately driven by (educated) human capital. At the same time the innovativeness of a particular region attracts educated human capital to that region (Fag
Debates Concerning Regional Innovation Systems, Clusters and Capacity in LiteratureRegions and nations function as the spatial contexts for human actions including innovation activities.A related field of discussion is that of innovation clusters, inspired largely by the works of Michael Porter (e.g. 1990;1998;, in which the main driver of heightened innovation tendency is the proximity of different innovative actors and the cooperation and competition between them (Moreno et al., 2005). Proximity allows trust to be built between actors through informal contact, i.e. face-toface communication and knowledge exchange, especially tacit knowledge, which results in the better