The role of intellectual capital in financial development: evidence from the banking sector of Turkey
28 Dec 2020-Competitiveness Review: An International Business Journal Incorporating Journal of Global Competitiveness (Emerald Publishing Limited)-
TL;DR: In this article, the authors explored and compared intellectual capital and its three components in deposit, investment and participation banks operating in Turkey's banking sector, and analyzed empirically the relationship between intellectual capital (IC) and financial performances of the banks.
Abstract:
Purpose
The objective of this study is to explore and compare intellectual capital (IC) and its three components in deposit, investment and participation banks operating in Turkey’s banking sector, and to analyze empirically the relationship between intellectual capital and financial performances of the banks.
Design/methodology/approach
The study uses a panel data of 46 banks operating in the Turkish banking system during the period of 2005–2019. To measure intellectual capital, value-added intellectual coefficient (VAIC) is used, consisting of the efficiency of a firm’s three types of capital – that is human, structural and employed capitals. To examine the proposed research hypotheses for each bank type separately, multiple regression analysis methods are used.
Findings
The findings of this paper reveal a positive and statistically significant relationship between IC and financial performance of the banks. Specifically, two of the components of IC, namely, employed and human capital efficiencies, are the most influential value drivers for the financial profitability of the banks, whereas structural capital efficiency has less importance in the profitability of the banks. The financial performance of the banks in Turkey is affected mostly by human capital. Therefore, if banks plan to increase their profitability, they need to pay more attention to human capital than structural and employed capitals.
Originality/value
The current study can be considered as one of the most comprehensive studies on analyzing the relationship between intellectual capital and financial performances of businesses in the Turkish banking sector. The previous studies analyzed either the banks individually or all banks as one group. The paper provides a valuable framework for executives, managers and policymakers in managing IC within the Turkish context as the most comprehensive study in the relevant literature.
Citations
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11 Mar 2022-Competitiveness Review: An International Business Journal Incorporating Journal of Global Competitiveness
TL;DR: In this article , a new index of national intellectual capital (INIC) was proposed to examine the relationship between national Intellectual Capital and national competitiveness, and the results indicated that during the study period the level of national Intellectual capital gradually increased.
Abstract:
Purpose
National intellectual capital is generally considered a strategic advantage for national competitiveness. However, the measurement of intellectual capital across countries for comparison purposes appears to receive little attention. This study aims to use a new index of national intellectual capital (INIC) to examine the relationship between national intellectual capital and national competitiveness.
Design/methodology/approach
This paper uses the INIC, developed by Vo and Tran (2021), to measure, compare and contrast differences in the level of national intellectual capital across 104 countries. INIC comprises the most crucial intellectual capital components: human capital, structural capital and relational capital. Various economic and social indicators are used as the proxies for these components of intellectual capital. Principal component analysis is used to derive INIC.
Findings
The results indicate that during the study period the level of national intellectual capital gradually increased. Europe has attained the highest level of national intellectual capital, whereas Africa has achieved the lowest level. This study’s findings confirm a close relationship between the national intellectual capital level and the national income level. Among the ten biggest countries, the USA achieved the highest national intellectual capital level, and China has significantly improved its cumulative level. Finland achieved the highest level of national intellectual capital in the world. National intellectual capital enhances a country’s competitiveness.
Practical implications
Findings in this study shed light on an international comparison of intellectual capital across countries and understanding how national intellectual capital contributes to and improves national competitiveness. Policymakers can consider and use these findings to support the accumulation of national intellectual capital and boost national competitive advantage, especially low-income countries and emerging markets.
Originality/value
To the best of the authors’ knowledge, this is the first study to estimate a degree of national intellectual capital around the world and examine its impact on national competitiveness based on publicly available data.
5 citations
TL;DR: In this paper , the authors present a bibliometric and content analysis of Turkish participation banking from Scopus using the keyword "Islam* or participation and bank* and Turkey or Turkish" was utilized in the title-abs-key.
Abstract: Turkey's Muslim heritage is rich and a Muslim majority country. Over time, more Islamic banks have opened around the world, including in Turkey. Turkey calls Islamic banks "participation banks". The study reviews bibliometric and content analysis of Turkish participation banking from Scopus. Scopus data were retrieved on Jan. 20, 2022. The keyword "Islam* or participation and bank* and Turkey or Turkish" was utilized in the title-abs-key. 82 articles and 2 reviews were examined from 1990 to 2021 in Scopus. RStudio, VOSviewer, and Excel analyzed quantitative data. Overall performance, citation (quantitative), and conceptual (qualitative) discussion for further research. The most-cited paper had 73 citations. The most relevant author, countries, institutions, and journals are AYSAN AF with 5 publications, Turkey, Istanbul University, and "International Journal of Islamic and Middle Eastern Finance and Management". The preceding literature evaluation reveals research gaps and study proposals. The analysis includes both mediumand high-quality English papers and reviews from Scopus. It accepts just Turkish participation banking-related papers. Additional research could involve the Web of Science and other units. According to the authors, It's the first bibliometric analysis of participation banking in Turkey. This research may also serve as a model for future Turkish scholars and policymakers.
2 citations
TL;DR: In this article , the authors investigated the level of relationship between intellectual capital and its components and sales / growth rate and profitability of the companies; identifies dominating significant constituents in NASDAQ Baltic companies.
Abstract: Research on intellectual capital (IC), while realizing the fact the investments or spending on IC that can either create or destroy value, during the last decade has changed the focus from analysis of companies IC meta system to analysis of ecosystem and company as part of framework. Intellectual capital (IC) analysis that as an academic discipline has evolved and exceled since early 90’s has reached the fourth stage of the research. Purpose of the study: Investigate the level of relationship between intellectual capital and its components and sales / growth rate and profitability of the companies; identifies dominating significant constituents in NASDAQ Baltic companies. Tasks: a) to identify intellectual capital and business performance ratios for the analysis, b) choose normalisations proxies, set number of control and moderate variables and period of impact to evaluate. Primary research methods: panel time-series sample of 92 companies and a 6-year observation of companies listed on the Baltic Stock Exchange between 2013 and 2019. This article contributes to the development of Intellectual Capital Theory, Value-Based Management Theory and Resource-View Theory. Elaborating on the analysis of the financial statements, as audited and public data, thorough analysis of the companies’ intellectual capital and its components has been undertaken improving the methodology of the evaluation of the impact, identifying research gaps and expanding the theoretical impact models. This study reveals a significant and positive relationship between Intellectual Capital and its components and sales / growth rate and profitability of the companies; identifies dominating significant constituents in NASDAQ Baltic companies. Expanding number of IC components, number of control and moderate variables and, crucially, testing for approbation of normalization proxies and adjusting IC components for value added or assets, provides thorough and accurate analysis of the impact.
Key words: Intellectual capital; extended impact models.
1 citations
TL;DR: In this article , the authors present a bibliometric and content analysis of Turkish participation banking from Scopus using the keyword "Islam* or participation and bank* and Turkey or Turkish" was utilized in the title-abs-key.
Abstract: Turkey's Muslim heritage is rich and a Muslim majority country. Over time, more Islamic banks have opened around the world, including in Turkey. Turkey calls Islamic banks "participation banks". The study reviews bibliometric and content analysis of Turkish participation banking from Scopus. Scopus data were retrieved on Jan. 20, 2022. The keyword "Islam* or participation and bank* and Turkey or Turkish" was utilized in the title-abs-key. 82 articles and 2 reviews were examined from 1990 to 2021 in Scopus. RStudio, VOSviewer, and Excel analyzed quantitative data. Overall performance, citation (quantitative), and conceptual (qualitative) discussion for further research. The most-cited paper had 73 citations. The most relevant author, countries, institutions, and journals are AYSAN AF with 5 publications, Turkey, Istanbul University, and "International Journal of Islamic and Middle Eastern Finance and Management". The preceding literature evaluation reveals research gaps and study proposals. The analysis includes both mediumand high-quality English papers and reviews from Scopus. It accepts just Turkish participation banking-related papers. Additional research could involve the Web of Science and other units. According to the authors, It's the first bibliometric analysis of participation banking in Turkey. This research may also serve as a model for future Turkish scholars and policymakers.
TL;DR: This paper analyzed the bibliometric characteristics of articles published in the qualified international literature on value drivers, considering the growing academic interest in the subject, the indications about the fragmentation of its discussion, and academic search for the best indicators.
Abstract: This research analyzed the bibliometric characteristics of articles published in the qualified international literature on value drivers, considering the growing academic interest in the subject, the indications about the fragmentation of its discussion, and academic search for the best indicators. Bibliometric analysis based on 14 indicators was performed on 292 articles published between 1997 and 2021 to identify the most influential authors, journals, institutions and countries, the collaboration networks, and the main topics in the research field. A qualitative approach was applied to reveal the main contributions of these articles and to build an agenda for future research. Results confirm the discussion fragmentation due to the identification of six thematic clusters and the debate dispersion across several countries, institutions, researchers, and journals. The ‘intellectual capital’ theme, through intangible assets analysis and covering discussions on trust and organizational reputation, is emphasized. Main contributions highlight the relationship of value drivers with intellectual capital, intangible assets, corporate social responsibility, and sustainability, which indicates the relevance of these themes in identifying elements that can contribute to organizational value.
References
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TL;DR: In this article, the null hypothesis of no misspecification was used to show that an asymptotically efficient estimator must have zero covariance with its difference from a consistent but asymptonically inefficient estimator, and specification tests for a number of model specifications in econometrics.
Abstract: Using the result that under the null hypothesis of no misspecification an asymptotically efficient estimator must have zero asymptotic covariance with its difference from a consistent but asymptotically inefficient estimator, specification tests are devised for a number of model specifications in econometrics. Local power is calculated for small departures from the null hypothesis. An instrumental variable test as well as tests for a time series cross section model and the simultaneous equation model are presented. An empirical model provides evidence that unobserved individual factors are present which are not orthogonal to the included right-hand-side variable in a common econometric specification of an individual wage equation.
16,198 citations
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TL;DR: In this paper, the residuals are sorted and the observation is located in the residual corresponding to the quantile in question, taking into account weights if they are applied, and the square root of the sum of the weights is calculated.
Abstract: We first sort the residuals and locate the observation in the residuals corresponding to the quantile in question, taking into account weights if they are applied. We then calculate wn, the square root of the sum of the weights. Unweighted data is equivalent to weighted data where each observation has weight 1, resulting in wn p n. For analytically weighted data, the weights are rescaled so that the sum of the weights is the sum of the observations, resulting in p n again. For frequency weighted data, wn literally is the square of the sum of the weights.
3,087 citations
TL;DR: In this paper, an empirical pilot study that explores the development of several conceptual measures and models regarding intellectual capital and its impact on business performance is presented, which can help both academics and practitioners more readily understand the components of Intellectual Capital and provide insight into developing and increasing it within an organization.
Abstract: This paper details an empirical pilot study that explores the development of several conceptual measures and models regarding intellectual capital and its impact on business performance. The objective of this pilot study is to explore the development of items and constructs through principal components analysis and partial least squares (PLS). The final retained, subjective measures and optimal structural specification show a valid, reliable, significant and substantive causal link between dimensions of intellectual capital and business performance. These results should help both academics and practitioners more readily understand the components of intellectual capital and provide insight into developing and increasing it within an organization. Suggestions are then made to advance and improve this research programme.
2,837 citations
TL;DR: In this paper, the authors investigated empirically the relation between the value creation efficiency and firms' market valuation and financial performance, and found that firms' intellectual capital has a positive impact on market value and financial performances, and may be an indicator for future financial performance.
Abstract: Purpose – The purpose of this article is to investigate empirically the relation between the value creation efficiency and firms’ market valuation and financial performance.Design/methodology/approach – Using data drawn from Taiwanese listed companies and Pulic's Value Added Intellectual Coefficient (VAIC™) as the efficiency measure of capital employed and intellectual capital, the authors construct regression models to examine the relationship between corporate value creation efficiency and firms’ market‐to‐book value ratios, and explore the relation between intellectual capital and firms’ current as well as future financial performance.Findings – The results support the hypothesis that firms’ intellectual capital has a positive impact on market value and financial performance, and may be an indicator for future financial performance. In addition, the authors found investors may place different value on the three components of value creation efficiency (physical capital, human capital, and structural cap...
1,185 citations
TL;DR: In this paper, the authors investigate the association between the efficiency of value added (VA) by the major components of a firm's resource base (physical capital, human capital and structural capital) and three traditional dimensions of corporate performance: profitability, productivity, and market valuation.
Abstract: The principal purpose of this study is to investigate the association between the efficiency of value added (VA) by the major components of a firm's resource base (physical capital, human capital and structural capital) and three traditional dimensions of corporate performance: profitability, productivity, and market valuation. Data are drawn from a sample of 75 publicly traded firms from South Africa from business sectors heavily reliant on intellectual capital. Empirical analysis is conducted using correlation and linear multiple regression analysis. Findings from the empirical analysis indicate that associations between the efficiency of VA by a firm's major resource bases and profitability, productivity and market valuation are generally limited and mixed. Overall, the empirical findings suggest that physical capital remains the most significant underlying resource of corporate performance in South Africa despite efforts to increase the nation's intellectual capital base.
998 citations