The Role of Public Policy in Advancing Social Innovation and Inclusion: EU and Romania’s Comparison

Our study analyzes the essential role of social innovation in reducing social exclusion and unemployment while improving citizens’ well-being through targeted public policies that enhance GDP allocations to social protection. Using Eurostat data and European Innovation Scoreboard (EIS) from 2019 to 2020, a comparative econometric analysis of all 27 EU member states, focused particularly on Romania, examines the interdependence between social innovation, social protection expenditures, social exclusion, and unemployment rates. Regression and ANOVA models confirm a significant positive relationship between social innovation and social protection spending. However, Romania’s overall share of social protection in GDP remains well below the EU average, despite higher relative spending on health, pensions, and family support, reflecting structural limitations and a slower diffusion of innovative practices. As an exploratory effort, the study acknowledges possible distortions caused by the pandemic, which temporarily increased expenditures and altered long-term trends. Broader macroeconomic factors such as inflation, demographics, and technology were not included but may refine future analyses. The findings provide both theoretical and practical insights, suggesting that enhancing social innovation through public policy can strengthen social cohesion, improve quality of life, and support the sustainable development of national protection systems.