Abstract
AbstractThis research examines the relationship between intellectual capital (IC) and corporate performance in the context of Asian developing economies characterised by an underdeveloped corporate‐governance system. Using a sample of 1,958 small and medium‐sized enterprises (SMEs) in Asian developing countries covering a 10‐year period from 2007 to 2016, we investigate this relationship in a dynamic modelling framework that controls for potential sources of endogeneity. We find that IC components, namely, human capital and relational capital, have a positive effect on SMEs' financial performance. The results reveal that human and relational capitals appear to be key elements that enhance the basis of service quality for the SME. Furthermore, the results show that structural capital is positively associated with long‐term SME financial performance. Regarding the impact of ownership, the positive impacts of human and structural capitals on financial performance are significantly lower for SMEs with more government ownership, and the positive impact of relational capital on financial performance is significantly higher for SMEs with more foreign ownership. Our findings highlight the important implication that owners or managers closely manage a firm's IC because it is a source of SME value creation and financial performance.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
