This blog post contains insights from the Giving Intangibles Real Value session which took place on January 24th, 2025 with featured panellists: Daren Teng (Director General, World Intellectual Property Organization), Ufuk Akcigit (Professor of Economics, University of Chicago), Erik Brynjolfsson (Director, Digital Economy Lab - Stanford University), Nancy Xu (Founder and CEO, Moonhub), Eva Maydell (Member of European Parliament).
Introduction
Intangible assets, encompassing intellectual property (IP), data, algorithms, and human capital, have emerged as pivotal elements in modern economic activities. The shift from tangible to intangible-driven value creation signifies a transformation in the global economy. According to the World Intellectual Property Organization (WIPO), investments in intangible assets have continuously outpaced tangible assets across a number of economies since 2008, with the U.S. reporting nearly double their investment in intangibles compared to tangible assets in 2023. Despite their growing economic significance, current financial and policy ecosystems remain under-equipped to measure, manage, and maximize their potential.
Measurement Methodologies and Challenges
The accurate valuation of intangible assets remains a significant challenge. Traditional accounting frameworks, designed to prioritize tangible assets such as machinery and buildings, are becoming increasingly inadequate for measuring value. According to WIPO, the global value of intangible assets has surpassed $6.9 trillion—exceeding the GDP of many national economies. However, the absence of standardized valuation mechanisms leaves these assets poorly represented in national accounts and corporate balance sheets.
Erik Brynjolfsson and his team at Stanford University’s Digital Economy Lab are addressing this gap through advanced regression analysis techniques. This method compares a company’s market value with its tangible assets to isolate value changes driven by intangibles in pricing and output.When these insights are correlated with digital investments, they reveal strategic drivers of productivity and innovation. Without such tools, policymakers risk perpetuating the "productivity J-curve," wherein the initial undervaluation of intangibles is followed by overinflated estimates, leading to flawed policy decisions.
Brynjolfsson highlights the critical need to measure intangible assets accurately, noting their pervasive role in modern life. For instance, individuals spend an average of eight hours a day consuming digital content, yet the economic value of this activity remains largely uncaptured. To address this, Brynjolfsson and his team have proposed frameworks such as "GDP-B", where the "B" reflects benefits. This approach demonstrates that trillions of dollars in digital value are being created annually. Therefore, underscoring the need for an economic paradigm shift to capture and reflect this previously invisible value.
Global Disparities in Intangible Asset Ownership
The distribution of intangible assets exposes significant disparities. Director General Teng stated that nearly 90% of digital capital is held by the top 10% of global firms. Such hyper-concentration stifles competition and limits the democratization of innovation. In the EU, for example, only 9% of small and medium enterprises hold IP rights, highlighting systemic barriers to entry for smaller players as highlighted by Eva Maydell, Member of the European Parliament.
To address this, policymakers must focus on reducing the financial and administrative barriers SMEs face in acquiring IP. Programs that subsidize patent applications, offer access to shared digital infrastructure, or provide training in IP management could significantly enhance the participation of smaller enterprises in the intangible economy.
Ecosystem Development
A robust digital ecosystem is foundational for fully integrating intangible assets into economic and cultural domains. Without such a framework, their value and innovation potential cannot be effectively realized, emphasizes Teng. A well-functioning ecosystem facilitates collaboration among governments, industry, and academia. It is underpinned by strong regulatory structures. For example, the WIPO Academy has trained over 500,000 individuals in intellectual property (IP) competencies, with 80% hailing from emerging economies, illustrating the transformative impact of targeted capacity-building initiatives. In Canada, systemic fragmentation in the science, technology, and innovation (STI) ecosystem impedes knowledge flows and innovation scaling. As proposed in collaborative models, a restructured approach to integrate traditional, modern, and emerging frameworks can mitigate these barriers. This approach enhances Canada’s ability to maximize intangible investments and integration into economic measurements.
Emerging Models of Asset Attribution
Emerging technologies like artificial intelligence bring new complexities to the intangible asset landscape. A notable challenge is the attribution of value to datasets that drive AI models. Current copyright frameworks may give way to "learn rights," enabling equitable value-sharing mechanisms for data creators. Such systems are essential for preserving human-driven creativity in a landscape increasingly dominated by machine learning. Failing to address these issues could lead to a depletion of original content, undermining the very ecosystems that sustain large language models and other AI technologies. Developing incentive structures to reward content creators while ensuring AI progress will require close collaboration between policymakers and private sector leaders.
Conclusion
Intangible assets are not just an economic reality—they are a policy imperative. As their value continues to rise, so does the urgency for governments and industries to adopt innovative frameworks for their management. By investing in advanced valuation techniques, fostering inclusive ecosystems, and recalibrating legal frameworks, economies can unlock the transformative potential of these assets. Policymakers and industry leaders must act decisively to integrate intangibles into broader economic strategies, ensuring sustainable growth, equitable innovation, and long-term competitiveness. The stakes, both economic, societal, and technological–are far too significant to overlook.
Appendix of Resources