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Interlectual Capital

In: Business and Management

Submitted By Trevourboy
Words 2284
Pages 10

The purpose of the article is to examine the result of intellectual capital towards financial aspects of organizational performance and what it constitutes of its performance indicator. Influence of intellectual capital on Hong Kong stock exchange, Australian financial sector, hotel industry, India pharmaceutical industry and its general impact on firms are discussed in this essay.
The most famous methodology used was the value added intellectual coefficient policy, where regression models were made to inspect the association between IC and the corporate financial performance indicator.
The results were positive and suggested that IC, was positively connected with success of productions by VAIC methodology. To be precise, structural capital was found to be the main component of IC.

It has been acknowledged by different scholars that universally the financial sector is converting into knowledge and fact based and the value of financial sector is acquired from intellectual capital than just from physical capital. Although the significance of intellectual capital is repeatedly expanding but companies are confronting measurement difficulties. The growing gap was noticed among market price and the book price of numerous organizations which attracted consideration towards examining the worth absent from records.
Various definitions of IC are given by different economist, academics and practitioners. Still not even a single meaning of IC has been accepted. Petty and Guthrie (2000) explain IC as the profitable value of structural and human capital of firms. Lev (2001) stresses two facts where the first one is, ‘the strengthened competition’ and second ‘the beginning of information technologies’. Together they are the features of the hotel industry. Unlike the old economy in which real resources influence the hotel...

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