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Capitalism Without Capital: The Rise of the Intangible Economy

3.80  ·  Rating details ·  1,365 ratings  ·  157 reviews
The first comprehensive account of the growing dominance of the intangible economy

Early in the twenty-first century, a quiet revolution occurred. For the first time, the major developed economies began to invest more in intangible assets, like design, branding, R&D, and software, than in tangible assets, like machinery, buildings, and computers. For all sorts of
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Hardcover, 288 pages
Published November 28th 2017 by Princeton University Press (first published 2017)
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Bill Gates
Aug 14, 2018 rated it really liked it
By the second semester of my freshman year at Harvard, I had started going to classes I wasnt signed up for, and had pretty much stopped going to any of the classes I was signed up forexcept for an introduction to economics class called Ec 10. I was fascinated by the subject, and the professor was excellent. One of the first things he taught us was the supply and demand diagram.

There are two assumptions you can make based on this chart. The first is still more or less true today: as demand for a
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Anna
Jan 12, 2020 rated it really liked it
'Capitalism Without Capital' falls into that droll sub-genre, 'biting critiques of capitalism by orthodox economists'. The authors argue that the increase in intangible investment by companies, which is often recorded in the form of expenses rather than investment, sheds light on many features of developed world economies, job markets, and political fractures. Like so many economics books, at times it frustrated me with unquestioned reductive assumptions, for example that GDP growth is a ...more
Vance
Apr 07, 2018 rated it liked it
The title Capitalism Without Capital tells part of the books story. The first half of the book is simply principles of macroeconomics with explanations for gross domestic product and other variables. I could have skipped that part without missing much of the story.

In general, intangible capital, such as human capital and technologies, have and are changing the economy. This supports greater productivity and economic growth along with challenges of structural unemployment and the potential for
...more
Marks54
Jan 30, 2018 rated it really liked it
I generally do not like the genre of popular business/economic trade books, but I will make an exception for this. This is a book by two economic researchers discussing the rise in importance of intangible assets in the global economy. The general punchline is that these sorts of assets are not well accounted for by current economic scorekeeping but that they really have grown in importance in recent decades and that the failure to account for them has undermined our understanding of how ...more
Veronica
Jan 20, 2020 rated it it was amazing
Shelves: economics
- Intangible investment represent sunk costs, generate spillovers, are more likely to be scalable, and tend to have synergies or complementarities with each other: they are more valuable together in the right combinations.
- The modern-day equivalent has become shot through with systems, processes, relationships, and software. This is not so much innovation, but innervationthe process of a body part being supplied with nerves, making it sensate, orderly, and controllable.
- Investment as defined
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Andrew
Capitalism Without Capital: The Rise of the Intangible Economy by Jonathan Haskel and Stian Westlake, is an interesting book about the nature of intangible investments and the growing importance of them in modern economics. The book covers a number of fields, including business strategy, management and leadership principles, and macroeconomics and politics. It examines intangibles from multiple angles, first examining how they are measured, their characteristics, and then delving into their ...more
Jason Furman
Nov 16, 2018 rated it it was amazing
Shelves: nonfiction, economics
An outstanding book that will change the way you think about the economy. Jonathan Haskel and Stian Westlakes book has a sweeping premise but is grounded in the economics literature while taking great care to never overclaim. The strength of the book is taking an idea that is the subject of an increasing amount of research, the increase in investment in intangibles, and then drawing connections to everything from shortcomings of financial markets to the rise of populism.

Starting just over a
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Diego
Sep 30, 2018 rated it really liked it
This book isnt what I thought it was going to be about but it was a pleasant surprise. Provides a clear understandable breakdown of intangible assets vs tangible assets and how they impact and are impacted by capitalism. Very applicable nowadays that proves intangible assets play a factor in the growing difficulty managing capital. ...more
May Ling
Aug 09, 2019 rated it really liked it
Shelves: economics
Oh man... one day I know my criticism of all these writers is going to come back to bite me. But what can I do? The front half is lovely and wonderful. Not a fan of the last few chapters. Editor failed to catch a pretty sexist conclusion on p. 177. If you just remove the 1 paragraph, it would have been fine. Also, the final chapters, seem to suggest the capital markets aren't addressing this intangible assets. I think they are either watering it because they don't think the audience knows enough ...more
Daniel Riveong
Jul 16, 2018 rated it it was amazing
Shelves: economics, management
Capitalism without Capital gives an excellent overview of where we are with capitalism, specifically that what drives innovation today is also driving inequality and socio-political challenges. Haskel does an excellent job of putting together ideas from Jaron Larnier and Peter Thiel to Thomas Piketty and Mariana Mazzucato.

Haskel delivers an excellent primer on what's happening today but does not go beyond. Is this the end point of capitalism? If not, how do we get to the next level? Despite
...more
Matt
Oct 08, 2018 rated it really liked it
An economist from 100 or even 50 years ago would have a hard time understanding or explaining the economic clout of Google. One reason why is because the measure of Google's assets is largely a measure of intangible assets -- nonphysical stuff. Intangible assets are those that 'typically involve the development of specific products or processes, or are investments in organizational capabilities, creating or strengthening product platforms that position a firm to compete in certain markets.' In ...more
Frank Stein
Mar 11, 2019 rated it really liked it
A large part of this book is just a recap of every significant piece of economic research that has been published over the last 40 years, including everything from Edward Glaeser's work on inter-industry spillovers in large cities to Sherwin Rosen's 1981 article on the "superstar economy." Yet the central insight animating the book, that the rise of an economy based on "intangible" assets (ideas, processes, patents) rather than "tangible" assets (trucks, machines, factories), explains much of ...more
Nils
Jul 26, 2018 rated it liked it
This book argues that intangible as opposed to physical investments have fundamentally different properties, which require different managerial techniques and different regulatory and tax apparatus. There are four main differences: intangible assets tends to be highly scalable, involve significant sunk costs, and they tend to spillover effects and exhibit synergies with one another. Haskell and Westlake take a broad view of what counts as intangible assets - including not just obvious things ...more
Samuel Peck
Oct 22, 2018 rated it really liked it  ·  review of another edition
A pretty informative book about how and why global economies are increasingly becoming intangible-intensive, and the potential implications. The sober writing is dull at times, but at the same time helps to ensure that the narrative stays grounded without being too hyperbolic like so many recent books about economic and industry change. The book does at times seem too much influenced by economics academia, and many of the scatter plot charts in Chapter 2 seem like tea-leaf-reading -  a potential ...more
Laurent Franckx
Aug 20, 2018 rated it really liked it
The title of this book is hugely misleading - and I see this as a compliment.
You see, when I first saw the title, I thought this was just another management-guru/futuristic type of book, that would extrapolate from a small sample of biased case studies to prove bold statements about life, the universe and everything. Reality turned out to be quite different, fortunately. This book is a well documented and nuanced analysis, based on an extensive literature on the subject, and it is extremely
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Daniel
Feb 19, 2020 rated it it was amazing
This is not a book about capitalism without money, but abut intangibles such as patents, kaizen/6 sigmas, brand names, networks etc.

1. There has been a shift from tangible to intangible investment.
2. Much of this does not appear in company balance sheet and thus are under-appreciated.
3. There are 4 property of intangibles:
3.1 Scalable: think internet apps
3.2 Sunk cost: all the money spent are mostly not worth anything to outsiders
3.3 Spill over: competitors can totally copy you and make a
...more
Sunil Kumar  Peruru
Mar 07, 2020 rated it it was amazing
Another good read found on Good reads. Its so amazing a machine that knows little about me can come up with great recommendations. Hail machine intelligence! I am convinced that machines are NOT just here to do the mundane jobs of humans.

This books explains the fundamental shift in the global economy towards intangible forms of investments- The rise in Intangible economy. A lot of effort went into explaining the change in the nature of investment over the last couple of decades (Investments in
...more
Kangwa Chanda
Dec 30, 2019 rated it really liked it
This book was very informative and enlightening on the growing market and investment opportunities that intangibles assets present.

It has provided me with new ideas on business and how the government can provide for the business community and encourage investments.

Intangibles is a subject that I have not paid much attention to before reading this book despite benefiting from and contributing to the market for intangibles.

The examples and analogies in the book, I felt, werent always related to
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Mehrsa
Apr 07, 2018 rated it liked it
This book should have been an academic paper or an op-ed. It was so dry and chart and number-y. The point is solid (though I would like to see some pushback from the Picketty camp on the inequality explanations) and the advice is also good (cultivate intangible talent and adult education seems like a great idea), but the text is pretty dry. It also feels to me to be overly optimistic about the potential of the intangible economy to remake society in a positive way. There are warnings, but I ...more
Kisor
Feb 28, 2019 rated it it was amazing
Shelves: 2019-q1, audible-in
Why software developers get more money compared to Doctors if skill is considered? Ans: Doctor's service is a rival asset, only one consumer at a time, but software can be used by any number of consumers simultaneously(auto scale the infrastructure using container services).

Got a different perspective on things I have already seen. E.g how intangible assets play a major role in success of tangible asset rich businesses like Gym, Coffeehouse etc.
Brahm
Did not finish. Got 42% into the audiobook and it was just not that interesting. Some things are physical, some things are intangible.

Only the second Bill Gates recommendation that I wasn't that into.
Ali Sattari
Oct 27, 2019 rated it really liked it
Shelves: economics
A good read on characteristics, effects and mis-conceptions around intangible (knowledge based?) assets. It's not that easy to balance (or nudge for/against) tangible and non-tangible assets, but there are ways governments and big corporations can do.
Stephen
Apr 06, 2018 rated it really liked it
This book offers to provide some clues to explaining the nature of current capitalism. Originally, the concept of capitalism was that capital accumulates within a corporate form in order to yield a flow of income to the owners of capital. Capital took the form of land and buildings, plant, stock, work in progress, and so forth. In a nutshell, in the form of tangible assets.

In recent decades the nature of capitalism has changed. Value no longer resides in the physical capital owned by companies,
...more
Phuong Thanh
Feb 01, 2020 rated it it was amazing
Must-read for anyone interested in modern business
Aakash Aggarwal
Mar 02, 2018 rated it really liked it
I have read this book with utmost sincerity and I am deeply impressed by the primer on the changing capital stock of the world. Needless to say, the level of content in this book is nominal and needs to be supplemented with a good reading of academic papers (Marianna Mazucato, Baruch Lev and others) to understand the state of tangible - intangible investments, public vs private sector investments, accounting regulations, treatment of intangible assets in the future, management and leadership ...more
Ayush Agrawal
Oct 02, 2018 rated it really liked it
This book is a means to look at one of the significant, but an overlooked economic trend.
Drtaxsacto
Mar 18, 2018 rated it it was amazing  ·  review of another edition
For the past couple of years there has been a lot of discussion about something called Secular Stagnation (Beginning with books by Tyler Cowan and Robert Gordon) there has been a lot of handwringing about whether the US economy is stuck in a low growth mode for a very long time. Part of the answer to understand whether the two distinguished economists are right is to understand the effects of moving increasingly to intangible goods.

You know the story, an iPhone has lots of physical parts but
...more
Boni Aditya
Dec 06, 2019 rated it it was amazing
This is one of the best books about economics that I have read in recent times. The book hits the perfect chord with recent times. The book explains the 1% and the 0.01 percent perfectly. The four S related to Intangibles perfectly explains how the Intangible economy differs from the tangible economy. Synergies, Spillovers, Sunk Costs and Scalability, account for the explosion in the intangible economy.

The book was extremely painful to read though, because of the textbook style approach adopted
...more
Jorge Alonso
Feb 06, 2018 rated it it was amazing  ·  review of another edition
Entertaining, engaging and inspiring

There has been much debate on the future of economic growth and its consequences.

As for the future of economic growth, many economists and commentators predict secular stagnation, as life changing inventions of the XXth century have been widely adopted and population is aging fast. Others argue, instead, that there is a technology revolution going on that will bring prosperity as never seen before, but it is hard to get a hold of the revolution from looking
...more
Alex
Mar 28, 2019 rated it it was amazing
A fascinating read which explains the rise, development and potential consequences of the increasing role played by intangible assets (software, IP, brands etc) in the world economy.

Until recent decades, economic production tended to be heavily reliant on capital and tangible assets (like machinery, plants, vehicles etc).

The authors argue that the rise of intangibles within the economy have explanatory value in phenomena such as the rise of inequality, the slowdown in economic growth and
...more
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