Table of Contents

Intangible Capital

Intangible Capital

Its Contribution to Economic Growth, Well-being and Rationality

John F. Tomer

Despite increasing research efforts, there is still much confusion regarding the nature and contribution of the most intangible forms of capital. This book develops a comprehensive and unifying conception of intangible capital in order to understand its role with respect to economic growth, well-being, and rationality. As the book illustrates, utilizing the intangible capital concept enables many new and important economic insights. Intangible capital is defined to include standard human capital, noncognitive human capital (including personal capital), social capital, and other intangible manifestations of human capacity. Understanding intangible capital is a key to realizing the full human potential of our economic systems.

Chapter 5: The Impact of Organizational Capital on Economic Performance: Evidence from Netherlands-based Multinational Corporations

John F. Tomer

Subjects: economics and finance, behavioural and experimental economics


Bart Eikelenboom* INTRODUCTION An organization (or, more specifically in this chapter, a corporation) can be looked upon as a bundle of resources or capital.1 This perspective derives from the resource-based view (RBV) within the domain of strategic management. There are multiple classifications of an organization’s resources or capital. First is the distinction between the tangible and intangible assets of the corporation. Another distinction that has emerged in the RBV is the division between resources and capabilities (Makadok, 2001). A resource is an observable (but not necessarily tangible) asset that can be valued and traded – such as a brand, a patent, a parcel of land or a license. A capability on the other hand, is not observable (and hence necessarily intangible) and hard to value (Hoopes et al., 2003). A third classification stems from Barney and Hesterly (1999) who distinguish several categories of a corporation’s capital: ● ● ● ● Physical capital: This is the physical manifestations of the technology used in a firm, a firm’s plant and equipment. Human capital: These are resources or capabilities linked to individuals associated with a firm. Organizational capital: This refers to the relationships among organization members (Tomer, 1987). Financial capital: This refers to the debt and equity financing available to firms. The first category is tangible; the second, human capital, is intangible and embodied in individuals. The standard human capital part of the latter includes the knowledge and skills that contribute to employees’ productive 64 Impact of organizational capital on economic performance 65 capacity (Becker,...

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