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Impact of Intellectual Capital on the Financial Performance of Innovation-Driven Pharmaceutical Firms: Empirical Evidence from India

Author

Listed:
  • Juhi Gupta

    (Indian Institute of Technology)

  • Payal Rathore

    (University of Illinois at Urbana-Champaign)

  • Smita Kashiramka

    (Indian Institute of Technology)

Abstract

The paper seeks to investigate the nature and intensity of the relationship between intellectual capital (IC) and financial performance using a comparative framework of the VAIC™ and e-VAIC™ models. Using panel data of listed Indian pharmaceutical companies between 2009 and 2018, the study finds a significant positive relationship between IC and financial performance. Within the components of VAIC, capital employed efficiency has the highest predictive power suggesting that physical resources continue to be the driving source of firm performance. Further, adding relational capital improves the overall performance of e-VAIC™ models compared to the VAIC™ model.

Suggested Citation

  • Juhi Gupta & Payal Rathore & Smita Kashiramka, 2023. "Impact of Intellectual Capital on the Financial Performance of Innovation-Driven Pharmaceutical Firms: Empirical Evidence from India," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(2), pages 1052-1076, June.
    • Handle: RePEc:spr:jknowl:v:14:y:2023:i:2:d:10.1007_s13132-022-00927-w
    DOI: 10.1007/s13132-022-00927-w
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    References listed on IDEAS

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