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Nexus between Intellectual Capital and Bank Productivity in India

Author

Listed:
  • Ranjit Tiwari

    (Chandragupt Institute of Management Patna, Patna 800001, India)

  • Harishankar Vidyarthi

    (Institute of Public Enterprise, Hyderabad 500101, India)

  • Anand Kumar

    (DCU Business School, Dublin City University, D09 Dublin, Ireland)

Abstract

This paper empirically investigates the influence of intellectual capital on changes in total factor productivity of 36 BSE-listed banks in India from 2005 to 2019. This study employs a two-stage analysis that begins by investigating changes in total factor productivity using the Malmquist Productivity Index estimated through Data Envelopment Analysis, and then computes intellectual capital and its sub-components within the Value Added Intellectual Coefficients model framework. Then, using the System Generalised Method of Moments, we investigate the impact of intellectual capital on changes in total factor productivity. According to our findings, productivity growth is primarily driven by efficiency changes rather than technological changes. Furthermore, regression results show that the intellectual capital index and its two sub-components, human capital and capital employed, have a strong positive impact on bank productivity. This research could help bank senior executives measure their productivity and intellectual capital, identify relevant intellectual capital elements that contribute to productivity and develop future policies to encourage and improve their intellectual potential. Furthermore, this is one of the few studies in the Indian context that examines the nexus between intellectual capital and productivity using the Malmquist Productivity Index.

Suggested Citation

  • Ranjit Tiwari & Harishankar Vidyarthi & Anand Kumar, 2023. "Nexus between Intellectual Capital and Bank Productivity in India," JRFM, MDPI, vol. 16(1), pages 1-17, January.
    • Handle: RePEc:gam:jjrfmx:v:16:y:2023:i:1:p:54-:d:1037639
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    References listed on IDEAS

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    1. David A Grigorian & Vlad Manole, 2006. "Determinants of Commercial Bank Performance in Transition: An Application of Data Envelopment Analysis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 48(3), pages 497-522, September.
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    4. Michael Luhnen, 2009. "Determinants of Efficiency and Productivity in German Property-Liability Insurance: Evidence for 1995–2006," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 34(3), pages 483-505, July.
    5. Ion Anghel, 2008. "Intellectual Capital and Intangible Assets Analysis and Valuation," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 3(3(520)), pages 75-84, March.
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    Cited by:

    1. Dominika Tumová & Martin Mičiak, 2023. "The Mechanism of Identification and Management of Risks Affecting the Process of Supporting Creativity Based on the Sample from the Slovak Academic Environment," JRFM, MDPI, vol. 16(3), pages 1-22, March.
    2. Pearl Abredu & Cai Li & Frank Kofi Essien & Isaiah Agbenu Akanbi Adegoke, 2023. "Unleashing Potential: Overcoming Bottlenecks and Catalyzing Innovations in Intellectual Capital Intellectualization of Small and Medium-Sized Enterprises in Jiangsu During the Post-Industrial Era," SAGE Open, , vol. 13(4), pages 21582440231, December.

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