The Quantitative Assessment of Organization Capital (Japanese)

Tsutomu Miyagawa and YoungGak Kim ()

Discussion Papers (Japanese) from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: Globalization and IT revolution in the 1990s requires that firms make a reorganization to survive in the more competitive world. There are several approaches to assess the organization capital. Using an optimizing firm model assuming that a firm holds multiple assets suggested by Yang and Brynjolfsson (2001) and Cummins (2003), we examine whether the organization capital is accumulated with investment in several types of assets. In contrast to Cummins (2003)'s results, we find the accumulation of organization capital associated with investment in R&D asset and marketing asset. Using these results and following Basu, Fernald, Oulton, and Srinivasan (2003), we measure the contribution of organization capital to the conventional total factor productivity (TFP) growth. Its contribution dominates about 3% of TFP growth in the middle term.

Pages: 21 pages
Date: 2006-06
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Persistent link: https://EconPapers.repec.org/RePEc:eti:rdpsjp:06048

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