Intangibles, Can They Explain the Dispersion in Return Rates?
Article first published online: 5 NOV 2012
© 2012 The Authors. Review of Income and Wealth © International Association for Research in Income and Wealth 2012
Review of Income and Wealth
Volume 59, Issue 4, pages 648–664, December 2013
How to Cite
Görzig, B. and Gornig, M. (2013), Intangibles, Can They Explain the Dispersion in Return Rates?. Review of Income and Wealth, 59: 648–664. doi: 10.1111/j.1475-4991.2012.00525.x
- Issue published online: 4 NOV 2013
- Article first published online: 5 NOV 2012
- firm-level profitability;
- intangible capital;
- national accounting
It is proven that the observed return rates on capital have an upward bias if firms are producing with unobserved intangible capital. Using a comprehensive firm level database for Germany, this theoretical preposition is supported empirically. Furthermore, by making unobserved intangible capital observable, dispersion in return rates is dramatically reduced. The results support the assumption that a considerable part of the observed dispersion in return rates among firms is attributable to unobserved capital formation in intangible capital.