The Innovation Component in Regional Policy

The paper analyses the impact of innovations on stimulating regional development. The main goal is to identify the effect of innovations on reducing the asymmetry of regional development. The study the innovative concepts emphasize the importance of understanding the link between innovations and their implementation via the regional policy mechanism. The utilization of the existing approach results suggests its use of innovative component of regional policy for stimulating equalization GRP per capita in regions and smoothing disproportions. We test the following hypothesis: the level of development of the region significantly depends on the innovation component. We assess a research model of hierarchical cluster analysis. The innovative component affects decreasing asymmetry in regional development. The proposed model offers a comprehensive set of alternative methods stimulating value creation in regions. Stimulating spending in the innovation sphere will contribute to the growth of employment, rise income per capita, increase the competitiveness, tax revenues, and promote infrastructure development. The proposed regional policy includes tax regulation, innovation policy, limited subsidies, and tax allowances, the top-priority investment in R&D, education, informational network.