Organisational capital refers broadly to internal practices, processes and systems that help firms to create value. This staff research paper presents an updated experimental estimate of organisational capital in the Australian market sector. It uses the standard expenditure approach for measuring intangible capital.
The report finds that business investment in organisational capital in Australia is significant and fast growing. The relative share of organisational capital stock increased dramatically during the 1990s when compared to physical capital. Over the last decade or so this has slowed down. This pattern appears to reflect similar trends in business function outsourcing and the uptake of enabling technologies over the same period.
Authors: Stan Bucifal and Francy Bulic
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