Rates of depreciation and the prices of intangible assets are less well established. The R&D
literature appears to have settled on a depreciation rate of around 20%, and OECD recommends
33% for software. Solovechik (2010) has a range of 5%–30% for artistic originals,
depending on the particular asset in question. To shed light on this and the depreciation
of other assets, in our intangible assets survey we asked for life lengths for various intangibles
(Awano et al., 2009). The responses were close to the assumed depreciation rates
in CHS, depending on the assumptions one makes about declining balance depreciation.
Once again, we shall explore the robustness of our results to depreciation, but note in
passing that our assets are assumed to depreciate very fast and so are not very sensitive
to depreciation rates, unless one assumes much slower rates, in which case intangibles are
even more important than suggested here.