Title: Intellectual capital and profitability in European football clubs

Authors: Panagiotis E. Dimitropoulos; Evangelos Koumanakos

Addresses: Department of Sport Management, University of Peloponnese, Orthias Artemidos & Plataion str., P.C. 23100, Sparta, Greece ' Department of Economics, University of Ioannina, University Campus, P.C. 45510, Ioannina, Greece

Abstract: The scope of this study is to examine the impact of intellectual capital on the profitability of European listed football clubs which are characterised as a human intensive industry. Selecting a sample from nine European countries over the period 2005-2010, the paper incorporates panel data methodologies in order to examine the impact of intellectual capital (measured via the value added intellectual coefficient - VAIC) on the financial performance of listed football clubs. Evidence indicates a positive association between intellectual capital and profitability. Specifically, the human capital efficiency indicator presents the most significant association with profitability, suggesting that managers who spent more on their employees (players, technical staff, etc.) add higher value to the organisation which leads to enhanced financial performance. This study can provide the impetus for managers and regulators to consider the management and reporting of IC components on a regular basis as an additional tool for alleviating the immense financial problems of European football clubs.

Keywords: value added intellectual coefficient; VAIC; financial performance; human capital; structural capital; European football; European soccer; football clubs; profitability; intellectual capital.

DOI: 10.1504/IJAAPE.2015.068862

International Journal of Accounting, Auditing and Performance Evaluation, 2015 Vol.11 No.2, pp.202 - 220

Accepted: 27 May 2014
Published online: 14 Apr 2015 *

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