Dynamics of intellectual capitals and bank efficiency in India

摘要

This article attempts to examine the impact of intellectual capitals and its sub-components on the bank's efficiency parameters for 38 listed Indian banks within multivariate panel data framework during the period from 2004-2005 to 2015-2016. The study uses the non-parametric Data Envelopment Analysis approach to estimate technical, pure technical and scale efficiency in the first stage, followed by computing Value Added Intellectual Capital and Modified Value Added Intellectual Capital as an indicator for intellectual capital performance. Finally, Tobit regression results suggest that intellectual capitals have statistically significant and positive but very low impact on all the three efficiency scores. At the sub-component level, only human capital efficiency has a significant impact with low value on the all three efficiency measures. Bank size and leverage are also found to be significant drivers of bank efficiency as well. Thus, the study's findings support higher investment in intellectual capitals in order to further improve the banking efficiency and value creation in India by adopting appropriate policy by management for proper input allocations, particularly human capital and capital employed in coming years.