In this paper co-authored by Nobel Laureate Myron Scholes, Jason Strimpel, and Paul Adams, Andersen Consulting examines the AI–intangible asset flywheel and why it now sits at the center of enterprise value creation.

In 1975, tangible assets accounted for 83% of the S&P 500's total value. When investors purchased equities, they were mostly buying a claim on tangible corporate assets. Today, tangible assets account for only 10% of the value of the S&P 500. So, exactly what are investors paying for?

The answer is intangible assets—and increasingly, the artificial intelligence systems that consume and produce them. As Nobel Laureate and Andersen Institute Advisor Myron Scholes observes:

"Intangible assets now account for the majority of enterprise value, yet they remain largely invisible in financial statements. AI systems consume these assets as core inputs and convert them into new sources of value. As AI becomes central to business performance, leaders must understand which intangible assets the enterprise controls and how they drive value creation. Without rigorous measurement of this AI–intangible asset relationship, capital allocation to AI will remain driven more by assumption than evidence."

This paper addresses that relationship. It advances a unified argument across three interconnected threads: first, that intangible assets constitute the dominant but largely invisible source of modern enterprise value; second, that this invisibility creates profound problems for capital allocation, governance, and valuation; and third, that AI fundamentally transforms how these assets are created, enhanced, and deployed—while simultaneously depending on them for its own effectiveness.

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