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The nexus of intellectual capital and operational efficiency: the case of Indian financial system

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  • Kanishka Gupta

    (Amity College of Commerce and Finance, Amity University)

  • T. V. Raman

    (Amity University)

Abstract

The emergence of the knowledge economy has made Intellectual Capital (IC) progressively significant. The aim of the study is to evaluate the impact of intellectual capital on operational efficiency calculated using Stochastic Frontier Analysis (SFA) for Indian financial sector companies. The present study has been used data of 64 companies for the time-period of 14 years (2004–2018) listed in National Stock Exchange-500. The paper has used modified Pulic’s Value Added Intellectual Coefficient (VAIC™) as a proxy to measure intellectual capital. Correlation and Dynamic panel regression has been used in order to examine the relationship and address the problems of heteroscedasticity, autocorrelation and endogeneity in the data. The results of the study indicates positive and significant relationship between IC and efficiency of the firm. Also, found that all the components of IC has a significant impact on firms’ efficiency. The outcomes would help the regulatory authorities and management of Indian financial sector in managing and organizing company’s IC.

Suggested Citation

  • Kanishka Gupta & T. V. Raman, 2021. "The nexus of intellectual capital and operational efficiency: the case of Indian financial system," Journal of Business Economics, Springer, vol. 91(3), pages 283-302, April.
    • Handle: RePEc:spr:jbecon:v:91:y:2021:i:3:d:10.1007_s11573-020-00998-8
    DOI: 10.1007/s11573-020-00998-8
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    Cited by:

    1. 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.
    2. Ahmed Jinjiri Bala & Aminu Hassan & Muhammad Liman Muhammad, 2024. "Do board characteristics matter in the relationship between intellectual capital efficiency and firm value? Evidence from the Nigerian oil and gas downstream sector," Future Business Journal, Springer, vol. 10(1), pages 1-24, December.

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    More about this item

    Keywords

    M-VAIC; India; Financial sector; Value creation; SFA; Efficiency; Dynamic panel regression;
    All these keywords.

    JEL classification:

    • C58 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Financial Econometrics
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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