Innovation refers to meaningful change, which provides a competitive advantage to products, processes and organization. Innovation is considered a key driver for economic growth. The modern tendency is to study innovation in the context of systems, made up of made up of different organizations and the relationships and linkages between them. The regional system is generally considered to be the most crucial. State policies promoting innovation also tend to focus on the regional level, as in the

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... case of the EU's highly acclaimed Smart Specialization strategy. Despite constantly improving technological infrastructure, the human-related aspects of innovation are still the most important part of the process. The human factor in innovation essentially contains three components: 1) Human Capital, which refers to education, knowledge and skills; 2) Social Capital, which refers to the strength of social links and social coherence; 3) Psychological Capital, which refers to peoples' values, attitudes and behaviors. The literature review provides evidence for the importance of all three types of capital and results in a new "holistic model of the human factor in innovation". The methodology suggests a number of indicators that can be used to measure the human factor in innovation on a regional level. Data was collected for these indicators for all the regions of EU countries. The research findings confirm the hypothesis that the human factor has a significant impact on innovation output (measured via the presence of innovations in the market), and show that social capital and psychological capital are even more significant than human capital. The research also showed which specific indicators had a significant impact of innovation output. The findings are discussed in depth. Based on them, an example of a new, extended innovation scale that gives the human factor the importance it deserves is provided. Also based on the findings, and bearing in mind current EU innovation policies, a number of policies and measures are propo [...]