Abstract. This paper examines how intangible assets affect investment decisions across firm sizes, considering the span of control. I differentiate between two types of intangible assets: transferable (R&D) and embedded (brand value and organizational capital), each impacting business dynamics in distinct ways. The results show that firms with fewer production lines invest more in transferable intangible assets, while larger firms prioritize embedded intangible assets due to diminishing returns in managerial productivity. In the long term, embedded intangible assets have a level effect on output, whereas transferable intangible assets are the engine of long-term growth. Both types of intangible assets increase markups, but larger firms experience lower markups and productivity per production line due to the span of control. Furthermore, the nontransferable nature of embedded intangible assets leads to reduced spillover effects in larger firms, driven by their higher investment in these assets.

Abstract. We examine the production network effects of domestic vs. foreign acquisitions of Turkish firms. Following foreign (but not domestic) acquisitions, we observe an erosion of the acquired firms’ markup, that is compensated by increased markups of those firms’ upstream sellers.

Abstract. In this research, I investigate what caused the intangible over tangible ratio to increase. One explanation for the surge in intangible assets is the increase driven by globalization and skill-biased task specialization. Globalization has expanded market size and intensified competition, making the marginal cost advantage more significant through intangibles. This increase in market size and competition encourages firms to invest more in intangible assets. Additionally, skill-biased task specialization enhances the importance of a firm’s organizational capital. The underlying intuition is that the production of high-skill labor requires intensive management skills, prompting firms to invest more in organizational capital to manage the production process efficiently. To analyze the effects of globalization and skill-biased technological change on the intangible-to-tangible asset ratio, I incorporate directed technological change within the Schumpeterian step-by-step innovation model, revealing how these forces jointly explain over 60% of the observed ratio increase since 1990.