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Bank technical, allocative and cost efficiencies in Africa: The influence of intellectual capital

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  • Adesina, Kolade Sunday

Abstract

This paper examines the effects of intellectual capital (IC) on technical, allocative and cost efficiencies for a panel of 339 commercial banks operating in 31 African countries over the 2005–2015 period. Our findings, which are based on Tobit and one-step system GMM regressions, provide evidence that IC exerts positive effects on bank technical, allocative and cost efficiencies. This finding, when significant, remains the same with the sample divided into various regional panels – East Africa, North Africa, Southern Africa, and West Africa. However, when our measure of IC is divided into its three components, namely human capital, physical capital and structural capital, only human capital is positively related to all the three efficiency measures across the panels. Our results suggest the need for African banks to place emphasis on human capital development.

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  • Adesina, Kolade Sunday, 2019. "Bank technical, allocative and cost efficiencies in Africa: The influence of intellectual capital," The North American Journal of Economics and Finance, Elsevier, vol. 48(C), pages 419-433.
    • Handle: RePEc:eee:ecofin:v:48:y:2019:i:c:p:419-433
    DOI: 10.1016/j.najef.2019.03.009
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    Cited by:

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    2. Wei-han Liu & Qian Long Kweh, 2022. "Reexamining nonlinear effects of intellectual capital on firm efficiency," Annals of Operations Research, Springer, vol. 315(2), pages 1319-1344, August.
    3. Dahui Zhou & Svetlana Danshina & Anastasia Kurilova & Marcin Lis, 2021. "The Impact of an Enterprise’s Intellectualization on Its Leadership Potential," Sustainability, MDPI, vol. 13(17), pages 1-19, August.
    4. Adesina, Kolade Sunday, 2021. "How diversification affects bank performance: The role of human capital," Economic Modelling, Elsevier, vol. 94(C), pages 303-319.
    5. Madugba Joseph Ugochukwu & Egbide Ben-Caleb & Uzondu Anoruoh Paul & Oparah Vivian Iheaku & Adesola Deborah Ayomide, 2023. "Intellectual Capital Value Addition and the Efficient Assets Management of Listed Manufacturing Firms in Nigeria," Folia Oeconomica Stetinensia, Sciendo, vol. 23(2), pages 241-260, December.
    6. Monika Barak & Rakesh Kumar Sharma, 2024. "Does intellectual capital impact the financial performance of Indian public sector banks? An empirical analysis using GMM," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-11, December.
    7. Trung Duc Nguyen & Chi Huu Lu, 2024. "Does Intellectual Capital Foster Deposit Growth in Banking System? Empirical Evidence from a Developing Economy," Advances in Decision Sciences, Asia University, Taiwan, vol. 28(2), pages 93-115, June.
    8. Hongxing Yao & Muhammad Haris & Gulzara Tariq & Hafiz Mustansar Javaid & Muhammad Aamir Shafique Khan, 2019. "Intellectual Capital, Profitability, and Productivity: Evidence from Pakistani Financial Institutions," Sustainability, MDPI, vol. 11(14), pages 1-30, July.
    9. Jian Xu & Muhammad Haris & Hongxing Yao, 2019. "Should Listed Banks Be Concerned with Intellectual Capital in Emerging Asian Markets? A Comparison between China and Pakistan," Sustainability, MDPI, vol. 11(23), pages 1-23, November.
    10. Shamsuddin Ahamad & Hamdan Amer Ali Al-Jaifi & Kizito Uyi Ehigiamusoe, 2023. "Impact of Intellectual Capital on Microfinance Institutions’ Efficiency: the Moderating Role of External Governance," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(2), pages 691-717, June.
    11. King Carl Tornam Duho, 2022. "Intangibles, Intellectual Capital, and the Performance of Listed Non-Financial Services Firms in West Africa: A Cross-Country Analysis," Merits, MDPI, vol. 2(3), pages 1-25, June.

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    More about this item

    Keywords

    Africa; Intellectual capital; Bank efficiency;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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