Finance Imperial College Business School

Smart Public Intangibles

Principal Investigator (Imperial): Professor Jonathan Haskel

Funder: EU Commission

Duration: December 2013 – November 2016

The public sector is a major investor in many intangible assets (e.g. education, training and R&D), as well as more tangible infrastructure assets such as roads and telecoms infrastructure. Spillovers from public R&D to the market sector has been studied for Europe but none of these studies allow for intangibles, and do not, for example, capitalise R&D in their TFP growth measures. One area of spillovers from the public sector that has attracted much attention is spillovers from general education to growth but there are very few studies of possible spillovers from a wider set of intangibles to productivity growth.

Key research questions:

  • What are the synergies between public intangibles and business sector productivity performance and what is its impact on economic growth? Using a cross-country econometric analysis we identify the mechanisms through which the possible complementarities between public and private intangibles directly affect the productivity performance of the business sector. Then we analyse the indirect effects of the accumulation of public intangibles on labour productivity growth.
  • How can we formalise mechanisms through which public intangible investment contributes to growth? Using unique microdata, we will evaluate biases that might arise in including occupation based intangible assets and standard human capital variables in growth accounting exercises, both those arising from measurement and possible externalities.
  • Does public sector intangible capital improves the performance and forecasting ability of two macroeconometric models? We undertake case studies in Italy and Spain to build new datasets on public intangible capital in order to analyse its impact on the long-term economic growth performance of these regions.

Research partners

  • Valencian Institute of Economic Research
  • National Institute of Economic and Social Research LBG
  • Luiss Libera Universita Internazionale Degli Studi Sociali Guido Carli
  • Istituto Nazionale Di Statistica
  • The Conference Board Inc
  • OECD
  • Zentrum Fuer Europaeische Wirtschaftsforschung Gmbh
  • Deutsches Institut Fuer Wirtschaftsforschung E.V.
  • Wiener Institut Fur Interntionale Wirtschaftsvergleiche
  • Fores