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

Juhi Gupta (), Payal Rathore and Smita Kashiramka
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Juhi Gupta: Indian Institute of Technology
Payal Rathore: University of Illinois at Urbana-Champaign
Smita Kashiramka: Indian Institute of Technology

Journal of the Knowledge Economy, 2023, vol. 14, issue 2, No 21, 1052-1076

Abstract: 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.

Keywords: VAIC; Intellectual capital; Financial performance; Intangible assets; Pharmaceutical sector; India (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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DOI: 10.1007/s13132-022-00927-w

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