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Intangible Capital and Firm-Level Productivity – Evidence from Germany

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  • Roth, Felix
  • Sen, Ali
  • Rammer, Christian

Abstract

This paper analyses the impact of intangible capital on firm-level productivity for Germany using panel data from the Community Innovation Survey for the time period 2006 to 2018. Our paper presents three novel results. First, we find a highly significant positive relationship between intangible capital and firm-level productivity with elasticities overall in line with previous findings reported for other large EU economies. Second, our results show that both manufacturing and services are highly intangible-capital intensive, and that intangibles have a greater impact on firm-level productivity in services - particular in the business services sector. Third, our results show that intangible capital investments in German firms are equal to investments in tangible capital since the early 2000s. Overall, the evidence presented in our paper indicates that Germany - in line with other advanced economies - has undergone a structural transition into a knowledge economy in which intangibles act as an important driver of firm-level productivity.

Suggested Citation

  • Roth, Felix & Sen, Ali & Rammer, Christian, 2021. "Intangible Capital and Firm-Level Productivity – Evidence from Germany," Hamburg Discussion Papers in International Economics 9, University of Hamburg, Department of Economics.
    • Handle: RePEc:zbw:uhhhdp:9
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    Cited by:

    1. Roth, Felix & Sen, Ali, 2021. "Intangible Capital and Labor Productivity Growth: Revisiting the Evidence," Hamburg Discussion Papers in International Economics 10, University of Hamburg, Department of Economics.
    2. Roth, Felix, 2022. "Intangible Capital and Labor Productivity Growth – Revisiting the Evidence: An Update," Hamburg Discussion Papers in International Economics 11, University of Hamburg, Department of Economics.

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    More about this item

    Keywords

    Intangible capital; firm-level productivity; panel data; Germany;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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