IDEAS home Printed from https://ideas.repec.org/a/diw/diwdwr/dwr9-31-1.html
   My bibliography  Save this article

German Economy Needs to Invest More in Knowledge Capital

Author

Listed:
  • Heike Belitz
  • Martin Gornig

Abstract

The efficiency of the German economy is powered by its knowledge-intensive industrial and services sectors. Yet the use of knowledge capital to drive innovation and productivity in Germany is rather low compared to other European countries and the United States. Germany is clearly lagging behind, especially in the services sector. The same applies to the industrial sector, where German businesses are not using knowledge capital to an above-average extent. Moreover, the level of knowledge capital modernity is low in Germany’s industrial and services sectors, which jeopardizes the competitiveness of the German economy. The federal government has set a target for increasing R&D expenditure to 3.5 percent of GDP by 2025. In terms of corporate investments in total knowledge capital, this corresponds to an almost 35 billion euro increase in total annual investments. For this target to be achieved, conditions for investing in knowledge capital must be reviewed and improved.

Suggested Citation

  • Heike Belitz & Martin Gornig, 2019. "German Economy Needs to Invest More in Knowledge Capital," DIW Weekly Report, DIW Berlin, German Institute for Economic Research, vol. 9(31), pages 247-253.
    • Handle: RePEc:diw:diwdwr:dwr9-31-1
    as

    Download full text from publisher

    File URL: https://www.diw.de/documents/publikationen/73/diw_01.c.670931.de/dwr-19-31-1.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Knowledge capital; intangibles; manufacturing; services;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:diw:diwdwr:dwr9-31-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bibliothek (email available below). General contact details of provider: https://edirc.repec.org/data/diwbede.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.