Household Innovation, R&D, and New Measures of Intangible Capital
Daniel Sichel () and
Eric von Hippel
No 25599, NBER Working Papers from National Bureau of Economic Research, Inc
Household R&D (or household innovation) is an important source of innovation that has to date been largely overlooked in research related to national accounts. Indeed, it is not currently counted as investment in the literatures on household production and human capital. This paper develops time series estimates of nominal investment, real investment, and real capital stocks for household R&D for product innovations in the United States. (We focus on product innovations because survey data on services innovations in the household sector are not yet available.) In the U.S., we find that household product R&D is significant. Our estimate of real investment in 2017 is $41 billion (2012 dollars). This is about half of what producers spend in R&D to develop new products for consumers – a sizable fraction. Our estimate of the real capital stock of household product R&D in 2017 is $233 billion. We conclude that household R&D is an important feature of household activity and, more generally, of the overall landscape of innovation.
JEL-codes: E01 E21 E22 E24 J24 O3 O31 O33 O34 (search for similar items in EconPapers)
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