But R&D on its own may give the wrong measure of innovation in the economy. Much of the innovative activity that businesses engage in is not immediately visible or measurable or even easily identifiable. Instead, it is what we term ‘hidden innovation’, which is not seen immediately and is not spent on technology. A report for the think tank Nesta in March 201410 estimated that the UK market sector invested £137.5 billion in knowledge assets whereas it invested only £80.8 billion in tangible assets.
