This research brief summarises the findings from our third Innovation Index which measures how much the UK invests in innovation, and the subsequent benefits to productivity.
- The UK invested £124 billion in intangible assets in 2009, more than in tangible assets
- Investment in intangibles fell during the recession, but by less than tangible investment
- R&D represents only 13 per cent of all investment in intangible assets
- Manufacturing, finance and personal services are the most intangible-intensive industries
- Intangible investment is much more prevalent in services than R&D, and also much less concentrated in a few firms
Innovation is more than R&D, yet the measurement of innovation relied for a long time just on R&D metrics. This led to innovation policies that were much focused on R&D. To overcome this, the UK government asked Nesta to develop a new Innovation Index that captured wider forms of innovation beyond R&D.
At the heart of the Index is a wider and more complete measure of how much the UK invests in innovation, and what the benefits of this are to productivity.
This research brief summarises the main findings from the third release of Nesta's Innovation Index, covering the period from 1990 to 2009. The full results are described in the Nesta Working Paper 12/09, UK Innovation Index: Productivity and Growth in UK Industries, by Peter Goodridge, Jonathan Haskel and Gavin Wallis.
The Innovation Index uses investment in intangible assets, such as design, organisational improvement, training and skills development, software development, advertising and market research, as well as the more traditional R&D, as a measure of innovation investment.
Albert Albert Bravo-Biosca, Brain MacAulay