A new approach to the valuation of intangible capital
By: Jason G. Cummins.
Series: Finance and economics discussion series ;; 2004-17; Finance and economics discussion series (Online) ;; 2004-17.
Publisher: Federal Reserve Board
Published: 2004
Place of publication: Washington, D.C
Language: eng
Format: Electronic resource
Description: "Intangible capital is not a distinct factor of production as is physical capital or labor.  Rather it is the "glue" that creates value from other factor inputs.  This perspective naturally suggests an empirical model in which intangible capital is defined in terms of adjustment costs.  My estimates of these adjustment costs from firm-level panel data suggest that no appreciable intangibles are associated with R&D and advertising, whereas information technology creates intangibles with a 72% annual rate of return--a sizable figure that is nevertheless much smaller than that reported in previous studies.  To build a bridge to previous research, I show that much larger estimates can be obtained with ordinary least squares, a method that ignores the possibility that the value of the firm and its investment policy are simultaneously determined"--Federal Reserve Board web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 7/9/2004.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.