Does investing in intellectual capital improve financial performance? Panel evidence from firms listed in Tanzania DSE

Pendo Shukrani Kasoga and Mohammed Elgammal

Cogent Economics & Finance, 2020, vol. 8, issue 1, 1802815

Abstract: Despite that reviews have been done in intellectual capital and the performance of firms, their status has remained uncertain in the emerging economy. Previous studies have generally focused on single industries and have overlooked the input of the service and manufacturing sectors as a whole. This study offers new insight into the area of intellectual capital and its relationship with firms’ performance in Tanzania and evaluates intellectual capital within the service and manufacturing sectors in totality. Using panel regression analysis for the periods of 2010 to 2019, the performance was measured in terms of SG, ROA, ATO, and Tobin’s. Heteroscedasticity and endogeneity were controlled using clustered robust standard errors. The empirical findings demonstrate a significant positive influence between structural capital efficiency and SG, ROA, ATO, and Tobin’s. However, the effect of human capital efficiency and capital employed efficiency were negative which suggests poor investment in human skills and capital of the firms. Further, VAIC was significantly positively associated with SG, ATO, ROA, and Tobin’s Q. It is recommended that to have a competitive advantage, managers and policymakers should focus on the three parts of intellectual capital which are the key drivers of value creation in the organization.

Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1080/23322039.2020.1802815 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:oaefxx:v:8:y:2020:i:1:p:1802815

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/OAEF20

DOI: 10.1080/23322039.2020.1802815

Access Statistics for this article

Cogent Economics & Finance is currently edited by Steve Cook, Caroline Elliott, David McMillan, Duncan Watson and Xibin Zhang

More articles in Cogent Economics & Finance from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().