This paper explores the growing importance of intangible assets as a potential source of innovation and
productivity gains, and the contribution of efficient resource allocation to this process. Realising the
growth opportunities implied by intangible assets depends on the ability to reallocate labour and capital to
their most productive use, which is determined by the design of framework policies. The redeployment of
tangible resources takes on heightened importance given the inherent difficulties in allocating intangibles
efficiently. Indeed, the characteristics of intangible assets create market imperfections, which hinder the
allocation of new ideas to where they can be developed most efficiently. While a number of policy
instruments are typically deployed to address these market failures, the paper also explores how the
growing importance of intangible assets is affecting the suitability of these policy tools. In turn, a number
of policy issues are identified, spanning the financing of start-up firms, the treatment of intangibles in
corporate valuation and accounting frameworks, competition policy in the digital economy and the role of
intellectual property rights frameworks in rapidly growing domains such as information technology.
Intangible Assets, Resource Allocation and Growth
A Framework for Analysis
Working paper
OECD Economics Department Working Papers
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