ABSTRACT
This chapter provides a theoretical framework for explaining the growing importance of intangible assets in the economy and for deriving policy implications. One policy implication of the phenomenon that has long been pointed out is the measurement problem: intangibles are difficult to measure both at firm and country level. The chapter shows that the growing importance of intangible assets has meant the necessity for firms to build networks with other economic actors, be they suppliers, rival firms, universities or other institutions. If intangible assets are not new to economic analysis, it is because they have simply been overlooked. Adam Smith, in 'An Inquiry into the Nature and the Causes of the Wealth of Nations' stated already in 1776 that intangibles are the engine of the capitalistic economy. An economy becomes more dynamic as its knowledge base spreads, and as its organisation of production is increasingly based on learning.
