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.
6 Feb 2018 David SchahinianShare
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
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
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