Intangible assets dynamics and firm behaviour

Alessandro Arrighetti, Fabio Landini () and Andrea Lasagni

No 2012-EP05, Economics Department Working Papers from Department of Economics, Parma University (Italy)

Abstract: We study the adoption of different intangible investment strategies in manufacturing firms. Contrary to most of the previous literature, we find such strategies to be highly differentiated. In particular we identify three types of investment behaviour: high and persistent, low and persistent, discontinuous. Using as a reference the capability-based view of the firm, we define and provide support for a set of hypotheses on the determinants of such behaviours. We obtain the following results: first, absorptive capacity led by R&D expenditures is a key competence in sustaining the adoption of an intangible investment strategy, which may be either persistent or discontinuous; second, the implementation of a persistent intangible investment strategy necessarily requires specific investments in the quality of human resources to be made; third, firms with a greater propensity to operate in international markets are more likely to adopt a persistent intangible investment strategy than they are to adopt a discontinuous one; fourth, firms that undertake a growth path that is based on highly uncertain demand segments and high organisational flexibility are likely to adopt a discontinuous intangible investment strategy; and five, the historical intangible asset base represents an important constraint on firms’ investment behaviour.

Keywords: : intangibles; firm behaviour; asset accumulation; organisational capabilities; R&D; investment strategy (search for similar items in EconPapers)
JEL-codes: D22 L21 L25 O32 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2012
New Economics Papers: this item is included in nep-bec, nep-hme, nep-ino, nep-knm and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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