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Writer's pictureunclesam243

Intangible Assets and Capital

Updated: Dec 21, 2020



Intangibles have four unusual economic properties. These properties can exist with tangible investments, but on the whole intangible assets exhibit them to a greater degree. These characteristics are:

• Scalability 

• Sunkenness

• Spillovers

• Synergies

Three further characteristics emerge from these four, namely, uncertainty, option value, and contestedness.

From

"Capitalism without capital: the rise of the intangible economy"

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What, then, does it take to be a corporate leader in the 2020s? Every firm is different, but those hiring a CEO, or aspiring to be one, should prize a few qualities. Mastering the tricky, creative and more collaborative game of allocating intangible capital is essential. A CEO must be able to marshal the data flowing between companies and their counterparties, redistributing who earns profits and bears risk. Some firms are ahead-Amazon monitors 500 measurable qoals -but most CEOS are still stuck clearing their email inboxes at midnight.

The Economist, “What it takes to be a CEO in the 2020s,” 2/6/20

The data economy as it exists today is already very unequal. It is dominated by a few big platforms. In the most recent quarter, Amazon, Apple, Alphabet, Microsoft and Facebook made a combined profit of S55bn, more than the next five most valuable American tech firms over the past 12 months. This corporate inequality is largely the result of network effects economic forces that mean size begets size. A firm that can collect a lot of data, for instance, can make better use of artificial intelligence and attract more users, who in turn supply more data. Such firms can also recruit the best data scientists and have the cash to buy the best AI startups.

The Economist, “Who will benefit most from the data economy” 2/20/20

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