Valuation of intellectual capital in knowledge‐based firms: The need for new methods in a changing economic paradigm

The purpose of this paper is to link two key disciplines in finance and science in a way which is representative of the many challenges in the development of the knowledge economy. However, the valuation of intangibles remains a contentious issue in finance. In this paper, the financial and economic...

Full description

Saved in:
Bibliographic Details
Published in:Management decision 2007-01, Vol.45 (9), p.1484-1496
Main Authors: Bose, Sanjoy, Thomas, Keith
Format: Article
Language:English
Subjects:
Business valuation
Capital formation
Cash flow forecasting
Discount rates
Discounted cash flow
Economic growth
Economics
Fair value
Finance
Financial analysis
Intellectual capital
Intellectual property
Knowledge
Net present value
Present value
Profitability
Profits
Science
Stockholders
Studies
Trademarks
Valuation
Citations: Items that this one cites
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:The purpose of this paper is to link two key disciplines in finance and science in a way which is representative of the many challenges in the development of the knowledge economy. However, the valuation of intangibles remains a contentious issue in finance. In this paper, the financial and economic issues pertaining to the valuation of intellectual capital are evaluated and addressed. An important aspect of raising capital is the ability to impute a fair value on the asset. The investigative process involves evaluating and assessing the appropriateness and efficiency of current models and finds them to be inadequate in yielding the true value of intellectual capital employed in knowledge-intensive firms.
ISSN:0025-1747
1758-6070
DOI:10.1108/00251740710828726