Is the influence of Intellectual Capital on Firm Performance homogeneous Evidence from India Employing Quantile Regression Model

This paper investigates the association between intellectual capital (IC) and firm performance by employing quantile regression model to derive robust and complete association that the classical mean regression fails to extricate. Secondary data on 253 listed Indian firms are collected from 'Capitaline Plus' corporate database for a period of 16 years from 1999-2000 to 2014-2015. IC and its components are computed using Pulic's value added intellectual coefficient (VAIC) model and firm performance is measured by return on asset (ROA). Both pooled OLS and quantile regression models are used to test the hypotheses. The results indicate that the pooled ordinary least square regression provides an incomplete picture about IC efficiency of firms. The results of quantile regression indicate that the positive influence of intellectual capital is higher at upper quantiles. The results also reveal that intellectual capital is a vital factor that creates a significant difference between out-performing and non-performing firms.