Public Intangibles: The Public Sector and Economic Growth in the SNA. (29th November 2017)

• Record Type: Journal Article
• Authors: Corrado, Carol; Haskel, Jonathan; Jona‐Lasinio, Cecilia
• Other Names: ven de Ven Peter guestEditor.; Harrison Anne guestEditor.; Fraumeni Barbara guestEditor.
• Is Part Of: Review of income and wealth. Series 63(2017)Supplement 2
• Page Start: S355
• Page End: S380
• Publication Date: 2017-11-29
• Subjects: O47 -- E22 -- E01 -- H4 -- H44 -- L33; Economic growth -- Intangible capital -- National accounts -- Non‐market sector -- Public sector -- Public goods; National income -- Accounting -- Periodicals; 332.05
• DOI: 10.1111/roiw.12325
• Languages: English
• ISSNs: 0034-6586

Abstract

Abstract : This paper sets out a framework for analyzing the impact of public investments on industry‐level productivity and economic growth. The concept of capital in the public sector is broadened from that which is mostly tangible (e.g. physical infrastructure) to that which also includes intangibles and long‐lasting societal assets. For the analysis of public investments, we find that in addition to expanding the asset boundary, national accounts also need to: (a) impute a net return to government and other non‐market capital—or provide industry‐level data by institutional sector of origin, allowing researchers to do so; (b) include all public payments to industry in industry‐level gross operating surplus (i.e. all subsidies, production, and product, and the annuity value of investment grants); and (c) provide crosswalks for key components of government expenditure by function of government (e.g. public funds for extramural R&D or worker training) to kind‐of‐activity classifications used for industries.