Intangible investments driven by software, data and artificial intelligence are growing

By 2024, intangible investments will account for almost 14% of global GDP, surpassing tangible investments (11%). According to data from the new World intangible investment highlights report - published by the World Intellectual Property Organisation (Wipo) in collaboration with the Luiss business school - assets such as software, data, brands and intellectual property have increased at three times the rate of those in tangible assets such as plant, machinery and property. In the 27 economies analysed, intangible investments have consistently outstripped tangible ones over time. Since 1995, the first year for which data are available, intangible investment has more than doubled in real terms, growing by 143%, while tangible investment grew by only 32%. "We are facing a structural change in the way economies grow and compete. In the face of global uncertainty, companies are strengthening their investments in intangible assets such as data, software, intellectual property and know-how. A trend that will also have significant impacts on public policy,' says Daren Tang, Director General Wipo.

"The constant strengthening of intangible investments reflects their key role in productivity and growth. In the age of Ai, this is increasingly about the need to invest in software, data, human and organisational capital," says Cecilia Jona-Lasinio, full professor of Applied economics at Luiss Business School and co-author of the report.

The most dynamic assets are software and databases, which grew by an average of 7% per year between 2013 and 2022.

In the most recent data for 2024, among the economies with the highest levels of intangible investment, France recorded the fastest growth in intangible investment in real terms (over 5% from 2023 to 2024), followed by the UK (over 4%), Spain and Denmark (both close to 4%) and the US (3.5%). In the latter, intangible investment in the US grew more than five times faster than tangible investment between 2020 and 2024. France followed a similar trend, with intangible investment growing three times faster than tangible investment. This divergence is even more pronounced in Germany, where intangible investment increased by more than 3 per cent annually during the period, while tangible investment decreased by about 1 per cent. In the UK, by contrast, tangible investment (up 4.8%) slightly exceeded intangible investment (up 4.3%) during the same period. India recorded the highest growth between 2011 and 2022 (+6.6% per year). While in Brazil, intangible investments increased by 14%, tangible investments by 8%.

The exception to the trend is Japan, where tangible investments have historically grown faster than intangible investments. Growing at an annual rate of about 0.9 per cent from 2013 to 2023. Intangible investments grew more slowly over the same period, at a rate of 0.6% per year. Since 2020, however, this trend has reversed: between 2020 and 2023, intangible investments grew at a faster rate, at an average of 1.2% per year, compared to 0.6% for tangible investments.