Organizational capital and firm performance. Empirical evidence for European firms

Abstract

The paper assesses the impact of Organizational Capital (OC) on firm perfor- mance for a sample of European firms. OC is proxied by capitalizing an income statement item (SGA expenses). A rationale for this methodology is provided. Results are robust and show the strong effect of OC on firm performance.Intangibles, Knowledge-based resources, Organizational capital,R&D capital stock, Translog production function