MARKET VALUATION OF INTELLECTUAL CAPITAL OF INDONESIAN LISTED FIRMS
This study aims to investigate the impact of intellectual capital (IC) on the market value of
Indonesian public listed firms. Further, this study also analyzes the relationship of each of the
individual IC elements with the sample firms’ market values. The research sample covers all
of the Indonesia Stock Exchange (IDX) public listed firms, excluding banking and financial
firms. This study observes a total of 829 firm years from 2013 to 2015. The authors employ
multiple regression analysis, with market values measured by Tobin’s Q) as the dependent
variable and intellectual capital efficiency (ICE) and its elements as the independent variable.
The findings show that, on average, the ICE of Indonesian listed firms has a weak positive
relationship with their market values. Additionally, further analyses find that Human Capital
Efficiency (HCE) has the strongest relationship with market value compared to Structural
Capital Efficiency (SCE) and Relational Capital Efficiency (RCE). This implies that ICE may
improve the Indonesian firms’ market value by improving the level of HCE.