Dynamic capital asset accumulation and value of intangible assets: An operations management perspective

Abstract

Extending the dynamic resource accumulation framework to operations management, we propose that the stock of younger capital assets and flow of capital assets are positively associated with the value of intangible assets, an increasingly predominant basis of competitive advantage. Based on a sample of 1390 manufacturing firms representing 8255 firm-year observations, the stock of younger capital assets was positively related to the value of intangible assets, an association that was strengthened by higher inventory efficiency. However, we also found that the flow of capital assets is negatively related to the value of intangible assets, an association that is further exacerbated by high production efficiency. Our findings explain how operations management could play an important role in influencing the intangible asset value of manufacturing firms.