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Measuring intangible assets in an emerging market economy: an application to Brazil

Author

Listed:
  • Dutz, Mark A.
  • Kannebley, Sergio Jr.
  • Scarpelli, Maira
  • Sharma, Siddharth

Abstract

This paper measures intangible investment in Brazil. It estimates that during 2000-2008, annual business spending on intangible assets or knowledge-based capital in Brazil averaged about 4 percent of gross domestic product. While this is significantly lower than comparable rates for the United States, Japan and the United Kingdom, which hover around 11 percent, it is not too far below estimates for other developed countries such as Italy and Spain. Of the total expenditure on intangible assets in 2006, about 23 percent was spent on computer software and databases, 43 percent on innovative property (predominantly research and development and new product development in financial services), and 34 percent on economic competencies (which comprises branding, employee training and organization improvement). Brazil's share of spending on economic competencies is markedly lower than that observed in the United States and the United Kingdom, and the analysis finds it to be the slowest growing of the major intangible categories. Finally, having extended the intangible investment estimation methodology to produce more disaggregated (industry-level) estimates, the authors show that intangible investment is positively correlated with recent export growth and total factor productivity estimates across manufacturing industries. This suggests that intangible or knowledge-based capital, as measured here, can account for part of the hitherto unexplained component of productivity growth.

Suggested Citation

  • Dutz, Mark A. & Kannebley, Sergio Jr. & Scarpelli, Maira & Sharma, Siddharth, 2012. "Measuring intangible assets in an emerging market economy: an application to Brazil," Policy Research Working Paper Series 6142, The World Bank.
  • Handle: RePEc:wbk:wbrwps:6142
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    References listed on IDEAS

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    Cited by:

    1. Dutz, Mark A. & O'Connell, Stephen D. & Troncoso, Javier L., 2014. "Public and private investments in innovation capabilities : structural transformation in the Chilean wine industry," Policy Research Working Paper Series 6983, The World Bank.
    2. Dutz, Mark A., 2013. "Resource reallocation and innovation : converting enterprise risks into opportunities," Policy Research Working Paper Series 6534, The World Bank.
    3. Albert N. Link & Christopher A. Swann, 2016. "R&D as an investment in knowledge based capital," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 43(1), pages 11-24, March.
    4. Andonova, Veneta & Ruíz-Pava, Guillermo, 2016. "The role of industry factors and intangible assets in company performance in Colombia," Journal of Business Research, Elsevier, vol. 69(10), pages 4377-4384.
    5. Dutz, Mark A. & O'Connell, Stephen D., 2013. "Productivity, innovation and growth in Sri Lanka : an empirical investigation," Policy Research Working Paper Series 6354, The World Bank.
    6. Omoye Sule Alade, 2013. "Determinants of Intangibles Assets Disclosure in Annual Report: Evidence from Nigerian Quoted Companies," International Journal of Asian Social Science, Asian Economic and Social Society, vol. 3(5), pages 1152-1165, May.

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    Keywords

    Debt Markets; Emerging Markets; Economic Theory&Research; Investment and Investment Climate; E-Business;

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