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Industrie 4.0

Intellectual capital makes machines more productive

Intellect increases productivity – and not only that of employees. According to a study by the German Institute for Economic Research (DIW), investments in machines and buildings are also becoming more effective as a result.

06 Feb. 2018
David Schahinian
Foto: DESTATIS & Ifo
Foto: DESTATIS & Ifo

The DIW considers "intellectual capital" to be investments in areas such as research and development, software and databases, marketing and advertising or technical design. For their study , the Berlin-based researchers analyzed around 2 million official pieces of company data. According to the study, 200 billion euros has already been invested in knowledge-based capital in Germany. But coming in at 320 billion euros, a significantly higher amount of money is being invested into physical capital. The opposite holds true in the U.S.

In some German industrial sectors, investments into knowledge-based capital are already significant according to Dr. Alexander Schiersch from the DIW. This includes the manufacturing sector, in particular automotive and mechanical engineering, but also the optical goods and electrotechnical industries. In automotive engineering, for example, 22 billion euros was invested in research and development as early as 2013. The decision paid off – the analysis revealed that intellectual capital and physical capital are complementary, giving productivity a further boost. The CESifo Group also sees investments into KBC (knowledge-based capital) as an opportunity to increase productivity. "By comparison, this type of potential tends to be left untapped in Germany," according to a current analysis .