Abstract This paper analyses the relationship between intangibles and the low business investment relative to Q at the firm-level. Using a large panel of UK firms, the findings suggest that… Click to show full abstract
Abstract This paper analyses the relationship between intangibles and the low business investment relative to Q at the firm-level. Using a large panel of UK firms, the findings suggest that a negative association exists between intangibles and fixed investment. The under-investment gap since 2002 can be largely reduced by controlling for intangibles. In particular, the impact is magnified for firms with higher leverage, lower tangibility and lower labour productivity.
               
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