Testing an extended R&D survey: Interviews with firms on innovation investment and depreciation

Whittard, Damian; Stam, Peter; Franklin, Mark; Clayton, Tony

Abstract

A recommendation from the revision of the System of National Accounts (SNA) 1993 is to include R&D as an intangible fixed asset. This reflects the increasing role of knowledge in the economy. The definition of an asset within the National Accounts is to deliver benefit to the owner for more than a year; a characteristic that R&D and other non technical activities often demonstrate. The result on the production account of capitalising intangible investments is to increase the level of GDP whilst providing more detailed data on the sources of productivity growth. Net wealth is increased as stocks of intangible assets are recorded in the balance sheet; as these stocks are used up they provide capital services to the asset owner. Therefore in order to ‘capitalise’ intangible investment within a national accounts framework it is necessary not only to estimate the levels of stock but also the rate at which the stocks depreciate and become obsolete over time. That is, to estimate their service lives.
The purposes of this study are:
- to seek answers on asset lives, using a framework developed by the OECD;
- to test whether companies can provide data on non-technical innovation activities, in
addition to data provided on conventional R&D.

• Journal Article Type: Article
• Publication Date: Apr 1, 2009
• Deposit Date: May 21, 2013
• Journal: NESTA Innovation Index Working Paper
• Peer Reviewed: Peer Reviewed
• Keywords: R&D, innovation, investment, depreciation, national accounts, productivity, capitalise intangible investment, service lives
• Public URL: https://uwe-repository.worktribe.com/output/997609
• Contract Date: Nov 15, 2016