These two notions go a long way towards explaining the findings and results of the
CHS model. The effects of the capitalization of intangibles on labour productivity are
only very minor (Corrado et al., 2005). This can be explained by the fact that
intangibles in the CHS model only affect capital (increasing it) and not labour and its
qualifications (e.g. spendings and investments in education and expertise are reflected
only via capital).