Intellectual capital performance and its long-run behavior: The US banking industry case

Abstract

This paper examines the impact of intellectual capital (IC) on the corporate performance of banking firms listed on the New York Stock Exchange from 2000 to 2011 as an attempt to rectify observed modeling issues in the extant IC performance models. It also studies the long-run behavior of IC as a strategic asset in the value-creation process. We propose four dynamic models to estimate IC performance, and the evidence of these models concludes that IC has a positive influence on the performance of the sample firms. However, the IC level and the magnitude of its influence on corporate performance have deteriorated over the sample period, raising doubts about the appropriateness of using IC as a strategic asset in the long term.

Keywords:

• intellectual capital
• corporate performance
• VAIC^TM
• NYSE