European Union has very ambitious goals in the area of research and development (R&D) policy, where the increase of investment in R&D should reach 3% of GDP by 2010, enabling Europe to become "most competitive and dynamic knowledge-based economy." This EU strategy is based on findings and recommendations of economic theory and analysis of key determinants of growth in most dynamic economies. The article presents selected theoretical findings of contemporary innovation and R&D policies, which form the backbone of European innovation policy. The main part of the article deals with Slovenian innovation and research policy. Looking at the EU R&D Action plan on the one hand and at the results and weaknesses of Slovenian innovation policies on theother, the authors suggest the key policy elements, which would enable Slovenia to develop contemporary R&D and innovation policy, and as a EU member contribute to the implementation of the Lisbon targets.
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