In regional development, innovation follows the jobs rather than the people.
April 1, 2026
Original Paper
Population–employment dynamics in the European Union: Does innovation lead or follow?
SSRN · 6504754
The Takeaway
Many cities try to attract 'talent' (the people) hoping innovation will follow. This study of 271 European regions found the opposite: the concentration of economic activity and existing labor interactions are the primary drivers that attract and create innovation.
From the abstract
This article examines the interaction between innovation, employment and population dynamics through the development of a system of simultaneous equations. The model is applied to a panel dataset of 271 European NUTS-2 regions. The results reveal strong bidirectional feedbacks between innovation and employment, while population dynamics opérate indirectly through employment rather than exerting a direct effect on innovation. Innovation is found to follow jobs rather than people, indicating that