Firm Age, Productivity, and Intangible Capital

Author Name HOSONO Kaoru (Faculty Fellow, RIETI) / TAKIZAWA Miho (Gakushuin University) / YAMANOUCHI Kenta (Kagawa University)
Creation Date/NO. January 2020 20-E-001
Research Project Microeconometric Analysis of Firm and Industry Growth
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First draft: January, 2020
Revised: March, 2022


We examine the role of intangible capital in firms' growth in sale through physical productivity (TFPQ), markup, and factor price distortion. Using a large dataset from Japan, we have constructed firm-level panel data of intangible capital consisting of software, organizational capital, and R&D stocks. We find that TFPQ plays a significant role in the firm growth. In addition, the accumulation of intangible capital accounts for a major part of sales growth. Among three types of intangible capital, organization capital is crucial for firm growth.