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The Valencian Community increases its investment in intangible assets by 30%,a level close to the national average
Valencian firms spend more than the national average in advertising and market research, but invest less in employee training and design
The new information and communication technologies (ICT) are transforming the production processes through robotization and automation, leading to the creation of new sectors in a context marked by globalization. These changes, which allow advancing towards the knowledge economy, require more investment in the so-called intangible assets related to R&D, software, firm organizational structure, on-the-job training, design, advertising or market research.
Spain is walking towards the path of the knowledge economy, although at a slower pace than other developed countries. Even though national investment in intangible assets has increased 22.5% since 2004, it still represents only 6.3% of GDP, placing Spain at the tail end of Europe, along with Italy, and widening the gap between Spain and other countries such as Sweden, France and the United Kingdom, which exceed 12% of GDP. The importance of investing in intangible assets, directly related to the increase in productivity and better quality of life, is observed in the case of United States, leading country in this sense, which invests more in intangible assets than tangible.
The Valencia Community started off with a very low level of investment in intangibles, but since 2004 it has experienced a 30% increase, 7.5 percentage points (pp) about the national level. Investment in intangibles within the region represents 6.2% of total GDP, almost equivalent to the national average. The economic crisis has boosted investment in intangibles, although Valencian firms still stand out for investment in tangible assets (buildings, machinery, etc.), 6.5 pp above the national average.
These results are included in the report La economía intangible en España. Evolución y distribución por territorios y sectores (1995-2014), a study developed by the Ivie and financed by Cotec Foundation for Innovation, through its Open Innovation Program (PIA). The directors of the study, Matilde Mas and Javier Quesada, Professors of Economic Analysis at the University of Valencia and Ivie Researchers, presented the main results on 15 January 2018 at the University-Enterprise Foundation (ADEIT), as part of the workshop organized by ADEIT and COTEC, focusing on the Valencian case. The Principal of the University of Valencia, Esteban Morcillo; and the Valencian Minister of Sustainable Economy, Productive Sectors, Commerce and Labour, Rafael Climent inaugurated the event, along with the President of ADEIT, Juan Manuel Pérez; and the Managing Director of COTEC, Jorge Barrero.
Regarding intangible assets, the Valencian Community invests more than the national average in market research (13.6 pp) and advertising (11.6 pp). However, it lags 20 pp behind in investment in other assets such as on-the-job employee training and design. Specifically, investment in intangible assets in the Valencia Community reached 6,221.1 million euros in 2014 (last year available). The region invested mostly in software and R&D (40% of total investment), followed by advertising (16.5%) and firm organizational structure (15.4%), while investing less in research (3.4%) and mineral exploration and entertainment and artistic originals (5%).
