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Intangible assets and firm-level productivity

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  • Crass, Dirk
  • Peters, Bettina

Abstract

Firms invest huge amounts into intangible assets. This paper explores to which extent different kinds of intangible assets are conducive to firm-level productivity. Our study contributes to the literature by simultaneously comparing productivity effects of innovative capital, human capital, branding capital and organizational capital and testing whether complementarity or substitutability exists between different intangible assets. Using panel data for the period 2006-2010, our econometric estimates confirm strong positive productivity effects of human capital and branding capital. Results for innovative capital are found to be mixed. While R&D has a strong positive impact on productivity, design & licences and patents show only weak productivity enhancing effects. The same holds for organizational capital. We furthermore detect several complementarities among different kind of intangible assets. Our results are robust to various parametric (OLS, FE) and non-parametric (Olley and Pakes, Levinsohn and Petrin) productivity estimation methods.

Suggested Citation

  • Crass, Dirk & Peters, Bettina, 2014. "Intangible assets and firm-level productivity," ZEW Discussion Papers 14-120, ZEW - Leibniz Centre for European Economic Research.
  • Handle: RePEc:zbw:zewdip:14120
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    2. Ana Martins & Tiago Domingues & Catarina Branco, 2018. "The Determinants of TFP Growth in the Portuguese Service Sector," GEE Papers 0114, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Nov 2018.
    3. Audretsch, David & Hafenstein, Marian & Kritikos, Alexander S. & Schiersch, Alexander, 2018. "Firm Size and Innovation in the Service Sector," IZA Discussion Papers 12035, Institute of Labor Economics (IZA).
    4. Siedschlag, Iulia & Di Ubaldo, Mattia, 2017. "The impact of investment in knowledge-based capital on productivity: firm-level evidence from Ireland," Papers WP556, Economic and Social Research Institute (ESRI).
    5. Sarah Guillou & Caroline Mini & Philippe Varin, 2019. "À la recherche de l’immatériel : comprendre l’investissement de l’industrie française," Sciences Po publications info:hdl:2441/2vgmbfhkm18, Sciences Po.
    6. Thum-Thysen, Anna & Voigt, Peter & Bilbao-Osorio, Beñat & Maier, Christoph & Ognyanova, Diana, 2019. "Investment dynamics in Europe: Distinct drivers and barriers for investing in intangible versus tangible assets?," Structural Change and Economic Dynamics, Elsevier, vol. 51(C), pages 77-88.
    7. Banholzer, Nicolas & Behrens, Vanessa & Feuerriegel, Stefan & Heinrich, Sebastian & Rammer, Christian & Schmoch, Ulrich & Seliger, Florian & Wörter, Martin, 2019. "Knowledge spillovers from product and process inventions in patents and their impact on firm performance. End report," ZEW Expertises, ZEW - Leibniz Centre for European Economic Research, number 222367.
    8. Nathan Chappell & Adam Jaffe, 2018. "Intangible Investment and Firm Performance," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 52(4), pages 509-559, June.
    9. Kartikeya Singh & Cody Kallen & Aparna Mathur, 2020. "Substance Requirements in the International Taxation of Intangible Capital: A Double-edged Sword?," Public Finance Review, , vol. 48(2), pages 139-177, March.
    10. Rammer, Christian & Peters, Bettina, 2016. "Investitionsschwäche oder Strukturverschiebung der Investitionstätigkeit? Zur Rolle immaterieller Investitionen für die Wettbewerbsfähigkeit von Unternehmen," ZEW Discussion Papers 16-037, ZEW - Leibniz Centre for European Economic Research.
    11. Marie Le Mouel & Alexander Schiersch, 2020. "Knowledge-Based Capital and Productivity Divergence," Discussion Papers of DIW Berlin 1868, DIW Berlin, German Institute for Economic Research.
    12. Rammer, Christian & Gottschalk, Sandra & Trunschke, Markus, 2020. "Innovationstätigkeit der Unternehmen in Ostdeutschland seit der Wiedervereinigung: Studie im Auftrag der Expertenkommission Forschung und Innovation," Studien zum deutschen Innovationssystem 7-2020, Expertenkommission Forschung und Innovation (EFI) - Commission of Experts for Research and Innovation, Berlin.
    13. Bartoloni, Eleonora & Baussola, Maurizio & Bagnato, Luca, 2020. "Waiting for Godot? Success or failure of firms’ growth in a panel of Italian manufacturing firms," Structural Change and Economic Dynamics, Elsevier, vol. 55(C), pages 259-275.
    14. Dudar, Olena & Voget, Johannes, 2016. "Corporate taxation and location of intangible assets: Patents vs. trademarks," ZEW Discussion Papers 16-015, ZEW - Leibniz Centre for European Economic Research.
    15. Siedschlag, Iulia & Lawless, Martina & Di Ubaldo, Mattia, 2017. "Investment in knowledge-based capital and its contribution to productivity growth: a review of international and Irish evidence," Research Series, Economic and Social Research Institute (ESRI), number BKMNEXT336, November.
    16. Crass, Dirk, 2014. "The impact of brand use on innovation performance: Empirical results for Germany," ZEW Discussion Papers 14-119, ZEW - Leibniz Centre for European Economic Research.
    17. Daniel Gonçalves & Ana Martins, 2016. "The Determinants of TFP Growth in the Portuguese Manufacturing Sector," GEE Papers 0062, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Nov 2016.
    18. Kaus, Wolfhard & Slavtchev, Viktor & Zimmermann, Markus, 2020. "Intangible capital and productivity: Firm-level evidence from German manufacturing," IWH Discussion Papers 1/2020, Halle Institute for Economic Research (IWH).
    19. Roth, Felix, 2019. "Intangible Capital and Labour Productivity Growth: A Review of the Literature," Hamburg Discussion Papers in International Economics 4, University of Hamburg, Chair of International Economics.
    20. Crass, Dirk, 2014. "Which firms use trademarks - and why? Representative firm-level evidence from Germany," ZEW Discussion Papers 14-118, ZEW - Leibniz Centre for European Economic Research.
    21. Guillaume Cléaud & Francisco de Castro Fernández & Jorge Durán Laguna & Lucia Granelli & Martin Hallet & Anne Jaubertie & Carlos Maravall Rodriguez & Diana Ognyanova & Balazs Palvolgyi & Tsvetan Tsali, 2019. "Cruising at Different Speeds: Similarities and Divergences between the German and the French Economies," European Economy - Discussion Papers 2015 - 103, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.

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    More about this item

    Keywords

    Intangible capital; productivity; R&D; marketing; firm-specific human capital; organizational capital; patents; trademarks;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure

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