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This paper gives an example of how human capital contributes to regional development in a small transition economy. We add new categories of creative occupation in order to have better possibilities for regional education level-creative class comparisons. Efforts are also taken to handle mobility of talent by the type of knowledge being exploited in the occupations. The data are collected from 168 Hungarian sub-regions from 2001 and from 20 counties from years 1996 and 2005. Our findings suggest that contrary to the results in more developed countries, indicators of Hungarian creative occupations do not outperform education level measures of local labour force in describing regional development. Creative core is proved to have stronger effect on regional development than creative top and creative professionals. Moreover, university graduates with internationally mobile knowledge seem to be less attracted to the capital city than graduates, whose knowledge is more embedded into the national context. These latter occupations concentrate with a growing intensity in the capital, since it has been strengthened as the gate for the global market during the transition from planned to market economy.
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