The Relationship between Intellectual Capital and Banks' Productivity in Pakistan

2021 ◽  
pp. 158-169
Author(s):  
Muhammad Asim Afridi ◽  
Imran Khan ◽  
Muddassar Khan
Keyword(s):  
Human Capital ◽  
Intellectual Capital ◽  
Productivity Growth ◽  
Banking Sector ◽  
Value Added ◽  
Malmquist Productivity Index ◽  
Productivity Index ◽  
Structural Capital ◽  
Capital Efficiency ◽  
The Impact

The performance of banks has been widely researched using accounting ratios, Tobin�s Q and market returns and less emphasis has been given to productivity measures. The productivity growth of banks is captured through Malmquist Productivity Index (MPI). The study then investigates the impact of intellectual capital on the productivity of banks in Pakistan. Value-added The intellectual Coefficient (VAIC) approach is employed to examine the intellectual capital of banks. Data is obtained from annual reports of 20 banks listed on the Pakistan Stock Exchange for 10 years (2007-2016). The panel corrected standard error approach is used for estimating the panel regression model. The findings provide evidence that the VAIC, human capital efficiency (HCE) and structural capital efficiency (SCE) has a positive impact on productivity growth (MPI). On the other hand, capital employed efficiency (CEE) has no significant impact on productivity growth. The VAIC approach may be useful for the banks and policymakers in a knowledge economy to integrate the intellectual capital in the decision-making process. Our results also suggest that banks in Pakistan shall increase spending on intellectual capital particularly on human capital and structural capital to elevate the intellectual capital of banks and subsequently get benefits in terms of increased productivity Keywords: Intellectual capital; Value added intellectual coefficient (VAIC); Malmquist productivity Index; Pakistan banking sector

scholarly journals The Impact of Intellectual Capital on Firms’ Performance: Evidence from Saudi Arabia

2020 ◽  
Vol 9 (4) ◽  
pp. 44
Author(s):  
Afnan Alturiqi ◽  
Khamoussi Halioui
Keyword(s):  
Human Capital ◽  
Saudi Arabia ◽  
Intellectual Capital ◽  
Market Performance ◽  
Value Added ◽  
Positive Association ◽  
Structural Capital ◽  
Capital Efficiency ◽  
The Impact ◽  
The Relationship

The purpose of this study is to empirically investigate the relationship between intellectual capital (IC) measured by the value-added intellectual coefficient (VAIC) and firms’ performance (FP) in the Saudi context. Data are drawn from a sample of 25 Saudi firms listed on the Saudi Stock Exchange (Tadawul) for the period 2015-2018. Using the VAIC model, the multiple linear regression models were constructed to examine the relationship between intellectual capital (IC) and firms’ performance (measured in terms of financial and market performance). The findings indicate that there is a positive association between overall intellectual capital efficiency as well as each of its three components (human capital efficiency, structural capital efficiency, capital employed efficiency) and the firms’ financial performance. Additionally, there is a positive association between human capital efficiency(HCE), structural capital efficiency (SCE), and the firms’ market performance. Overall, the findings suggest that human capital efficiency (HCE) has a significant and positive impact on firms’ financial and market performance in Saudi Arabia. The VAIC method may be a useful tool for managers and investors in their decision process. This is the first study about the impact of intellectual capital on firms’ performance in four industry groups in Saudi Arabia using the VAIC model.

scholarly journals The Impact of Intellectual Capital on Financial Performance: A Study of Sri Lankan Financial Institution

2021 ◽  
Vol 04 (09) ◽  
Author(s):  
A. Nishanthini ◽  
Keyword(s):  
Human Capital ◽  
Financial Performance ◽  
Intellectual Capital ◽  
Negative Impact ◽  
Financial Institution ◽  
Value Added ◽  
Sri Lankan ◽  
Structural Capital ◽  
Capital Efficiency ◽  
The Impact

Intellectual Capital is essential in every economical activity. The aim of this study how intellectual capital impact on financial performance in Sri Lankan financial institution. To achieve objective of this research banking institution has been selected from Colombo Stock Exchange financial directory for the period from 2016 to 2020. Random sampling technique were used to analysis the data. MVIAC model used for the measurement of independent variable in this study. This model is a composite sum of two indicators these are Capital Employed Efficiency (CEE) - indicator of VA efficiency of capital employed and Intellectual Capital Efficiency (ICE) – indicator of value-added efficiency ofcompany’s Intellectual Capital base. Intellectual Capital Efficiency is composed of (a) Human Capital Efficiency (HCE) – indicator of value-added efficiency of human capital; and (b) Structural Capital Efficiency (SCE) – indicator of value-added efficiency of structural capital (c) Rational Capital Efficiency (RCE). Finding represent that intellectual capital has significant impact on financial performance of Sri Lankan financial institution, specially banking industry. SCE and CEE has negative impact while RCE impact positively on financial performance.

Intellectual capital and bank productivity in emerging markets: evidence from Ghana

2016 ◽  
Vol 54 (3) ◽  
Author(s):  
Abdul Latif Alhassan ◽  
Nicholas Asare
Keyword(s):  
Regression Analysis ◽  
Emerging Markets ◽  
Intellectual Capital ◽  
Productivity Growth ◽  
Design Methodology ◽  
Emerging Market ◽  
Value Added ◽  
Malmquist Productivity Index ◽  
Productivity Index ◽  
Practical Implications

Purpose This paper examines the effect of intellectual capital on bank productivity in an emerging market in Africa. Design/methodology/approach The Malmquist Productivity Index is employed to estimate productivity growth of 18 banks in Ghana from 2003 to 2011 while the Value Added Intellectual Coefficient is used to measure bank intellectual capital performance. The panel-corrected standard errors estimation technique is used to estimate a panel regression model with Malmquist Productivity Index as the dependent variable. Bank market concentration and bank size are controlled for in the regression analysis. Findings We find productivity growth to be largely driven by efficiency changes compared to technological changes. The results from the regression analysis indicate that Value Added Intellectual Coefficient has a positive effect on the productivity of banks in Ghana. We also find human capital efficiency and capital employed efficiency as the components of Value Added Intellectual Coefficient that drive productivity growth in the banking industry. Bank size and industry concentration are also identified as significant drivers of productivity in the market. Practical implications The study’s findings support investments in intellectual capital as a means of improving the performance of banks in emerging markets Originality/value To the best of our knowledge, this is the first study to empirically examine the relationship between intellectual capital and productivity in an emerging banking market in Africa.

scholarly journals Intellectual Capital Terhadap Nilai Pasar Dan Kinerja Keuangan Perusahaan Dengan Value Added Intellectual Capital (Studi Pada Perusahaan Manufaktur di Bursa Efek Indonesia Tahun 2008-2011)

2019 ◽  
Vol 7 (2) ◽  
pp. 43
Author(s):  
Sofie Sofie ◽  
Ari Prihartini ◽  
Rinda Liana
Keyword(s):  
Human Capital ◽  
Intellectual Capital ◽  
Firm Value ◽  
Statistical Tests ◽  
Value Added ◽  
Market Value ◽  
Manufacturing Companies ◽  
Structural Capital ◽  
Capital Efficiency ◽  
And Performance

<p class="Style1"><em>This study aims to ident6 and analyze the effect of intellectual capital as one of the company's intangible assets to market value and financial performance<sup>.</sup>of the company-manufacturing companies using the Value Added Intellectual Capital (VAIC <sup>m</sup>). The analysis method used is multiple panels because the structure of the data used in this research is the data panel. The results of the hypothesis theory shows that the intellectual capital has significant effect on the market value and performance of the company. The three components of intellectual capital, as the physical capital efficiency, human capital and structural capital efficiency, have a positive effect on firm value and performance of companies that dproksi by ROA, ATO, ROE and OI / S. So do the results of statistical tests, except for the efficiency of the human capital and structural capital efficiency ROE against Of / S. The results show that intellectual capital is a factor that is very important and significant effect on the quality of the company which in turn directly affects firm value andfinancial performance of the company.</em></p>

scholarly journals Measuring intellectual capital efficiency: A case of football clubs in the UEFA Champion League

2020 ◽  
Vol 4 (1) ◽  
pp. 30-40
Author(s):  
Md. Jahidur Rahman ◽  
Siyan Ding
Keyword(s):  
Human Capital ◽  
Intellectual Capital ◽  
Positive Impact ◽  
Value Added ◽  
Sports Industry ◽  
Structural Capital ◽  
Football Clubs ◽  
Capital Efficiency ◽  
Almost All ◽  
Football Industry

The purpose of this study is to examine the intellectual capital efficiency of football clubs in the UEFA Champion League between 2010 and 2019. We measure the intellectual capital efficiency of each football club through Value Added Intellectual Coefficient (VAIC) method developed by Pulic (1998, 2004), Ghosh and Mondal (2009), Yalama (2013), Ozkan, Cakan, and Kayacan (2017). Using a sample of 10 football clubs from 7 countries, we find that almost all clubs use their intellectual capital efficiently with great coefficients. We also document that human capital, as the core of intellectual capital, has a positive impact on structural capital. Our finding is significant for sports managers to make strategic management of intellectual sources to create value in the football industry. It suggests that football clubs should pay more attention to intellectual capital like fan loyalty and talented players. Meanwhile, it helps the sports industry to play a great role of human capital in intellectual capital and to increase the competitive advantage of the enterprise.

scholarly journals The impact of intellectual capital on the profitability of commercial banks in Serbia

2018 ◽  
Vol 63 (216) ◽  
pp. 85-109 ◽  
Author(s):  
Sinisa Radic
Keyword(s):  
Panel Data ◽  
Intellectual Capital ◽  
Commercial Banks ◽  
Banking Sector ◽  
Value Added ◽  
The Other ◽  
Capital Efficiency ◽  
The Subject ◽  
The Republic ◽  
The Impact

The subject of the research in this paper is the impact of intellectual capital efficiency on the profitability of commercial banks in the Republic of Serbia. The efficiency of commercial banks? intellectual capital was measured by the created value added in the observed period, using the Value Added Intellectual Coefficient methodology (VAIC). Empirical analysis was carried out using econometric analysis of panel data for 27 banks that were operating in the banking sector of the Republic of Serbia in the period 2008-2016. The results of the analysis show that the significance of the impact of the efficient use of intellectual capital on the profitability of banks operating in Serbia depends on the selected profitability measure. When ROA is chosen as an indicator of profitability the bank?s level of indebtedness determines the sign of this influence, so at higher levels of indebtedness efficient use of intellectual capital negatively affects the profitability of the bank. On the other hand, in this case the size of the bank does not significantly affect the dependence of the bank?s profitability on the efficient use of its intellectual capital. If ROE is a measure of the profitability of banks the efficient use of intellectual capital has no significant impact on banks? profitability.

Intellectual Capital and Profitability: Evidence from Indian Pharmaceutical Sector

2020 ◽  
Vol 24 (2) ◽  
pp. 204-216 ◽  
Author(s):  
Kanishka Gupta ◽  
Sweta Goel ◽  
Prakash Bhatia
Keyword(s):  
Human Capital ◽  
Intellectual Capital ◽  
Stock Exchange ◽  
Value Added ◽  
Physical Capital ◽  
Pharmaceutical Companies ◽  
Time Period ◽  
Panel Data Regression ◽  
Capital Efficiency ◽  
The Impact

Intellectual capital (IC) has gained recognition in enhancing the firms’ value and gain competitive advantage in the developed world. Thus, it is imperative for all stakeholders to have an understanding of its impact on firms’ profitability. The present study aims to analyse the impact of intellectual capital on firms’ profitability of Indian pharmaceutical companies listed in National Stock Exchange (NSE-500) for the time period of 10 years (i.e. 2009–2018). The paper has used modified version of Pulic’s Value Added Intellectual Coefficient, i.e., M-VAIC as a proxy to measure intellectual capital and firms’ profitability as represented by ROA, ROE and EBITDA. In line to analyse the effectiveness, a balanced panel data regression technique has been used. The results of the paper indicate a significant relationship between intellectual capital and firms’ profitability. Also, it is found that human capital, relational capital and physical capital have a significant role in increasing the profitability of the firm. The analysis would help the administration and management of pharmaceutical companies in the composition and organization of intellectual capital, stakeholders in the decisions related to investment and financial specialist for enhancing intellectual capital efficiency and value creation for the firm. Human capital is found to be having a positively significant impact on firms’ profitability; their inclusion and management are suggested for the companies.

The impact of intellectual capital on SMEs’ performance in China

2019 ◽  
Vol 20 (4) ◽  
pp. 488-509 ◽  
Author(s):  
Jian Xu ◽  
Jingsuo Li
Keyword(s):  
Human Capital ◽  
Intellectual Capital ◽  
Manufacturing Sector ◽  
Operating Efficiency ◽  
High Tech ◽  
Relational Capital ◽  
Content Type ◽  
Structural Capital ◽  
Capital Efficiency ◽  
The Impact

Purpose The purpose of this paper is to explore and compare the extent of intellectual capital (IC) and its four components in high-tech and non-high-tech small and medium-sized enterprises (SMEs) operating in China’s manufacturing sector, and to examine the relationship between IC and the performance of high-tech and non-high-tech SMEs. Design/methodology/approach The study uses the data of 116 high-tech SMEs and 380 non-high-tech SMEs listed on the Shenzhen stock exchanges during 2012–2016. The modified value added intellectual coefficient (MVAIC) model is used incorporating four components, namely, capital employed, human capital, structural capital and relational capital. Finally, multiple regression analysis is utilized to test the proposed research hypotheses. Findings The findings of this paper reveal that there is significant difference in MVAIC between high-tech and non-high-tech SMEs. The results further indicate a positive relationship between IC and financial performance of high-tech and non-high-tech SMEs. Specifically, IC is positively associated with firms’ earnings, profitability and operating efficiency. Additionally, capital employed efficiency, human capital efficiency and structural capital efficiency are found to be the most influential value drivers for the performance of two types of SMEs while relational capital efficiency possesses less importance. Practical implications This paper will provide a valuable framework for executives, managers and policy makers in managing IC within the Chinese context. Originality/value To the best knowledge of the authors, this is the first empirical study that has been conducted on high-tech and non-high-tech SMEs in the manufacturing sector in China.

THE IMPACT OF INTELLECTUAL CAPITAL ON CORPORATE PERFORMANCE: EVIDENCE FROM THE EGYPTIAN INSURANCE MARKET

2016 ◽  
Vol 20 (03) ◽  
pp. 1650034 ◽  
Author(s):  
MOHAMED SHERIF ◽  
MAHMOUD ELSAYED
Keyword(s):  
Intellectual Capital ◽  
Corporate Performance ◽  
Value Added ◽  
Financial Capital ◽  
Insurance Companies ◽  
Structural Capital ◽  
Capital Efficiency ◽  
And Performance ◽  
The Impact ◽  
Unobservable Heterogeneity

This paper examines, using various econometric techniques, the impact of intellectual capital (IC) on the performance of Egyptian insurance companies listed between 2006 and 2011. We measure IC using the value added intellectual coefficient (VAIC) approach and its components developed by Pulic (2000), and both a direct and a moderating relationship between VAIC and corporate performance are investigated. Our results show a direct relationship between (IC-VAIC) and the performance of Egyptian insurance companies, particularly with capital employed efficiency (CEE), and to a lesser extent with human capital efficiency. In addition, a positive relationship between IC (capital employed and structural capital) and performance in the prior and current years is found. Evidence also suggests the possibility of a moderating relationship between IC and physical and financial capital, which in turn impacts on corporate performance. Our study also reveals the importance of taking into account any unobservable heterogeneity and endogeneity issues when analysing corporate performance.

scholarly journals The impact of the intellectual capital components on firm’s performance in emerging markets

2021 ◽  
Vol 11 (2) ◽  
pp. 8-17
Author(s):  
Noomen Chaabane
Keyword(s):  
Human Capital ◽  
Intellectual Capital ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Value Added ◽  
Multiple Linear Regression Analysis ◽  
Future Research ◽  
Structural Capital ◽  
Stock Market Performance ◽  
The Impact

The objective of this research is to review, analyse, and provide empirical evidence about the impact of the intellectual capital (IC) characteristics on the firm performance on listed 26 companies in Tunisian Stock Exchange for the years 2010–2019. 260 companies were taken as a sample of this research using the purposive sampling method. The efficiency of intellectual capital was measured using the value added intellectual coefficient (VAIC) method developed by Pulic (2000). The research method used was multiple linear regression analysis. Our empirical analysis substantiates the fundamental role of IC components in improving the financial and stock market performance of listed Tunisian companies. The results obtained on the human capital efficiency variable contribute to improving the market of Tunisian listed companies and confirm the role attributed to human capital in the knowledge economy and even the basic hypothesis of the VAIC method. Investors do not place any importance on the following variables: structural capital, human capital and the efficiency of structural capital during market valuation. Future research is suggested to use cross-country companies as the sample.

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