Effects of intellectual capital on innovative performance: The role of knowledge-based dynamic capability

The purpose of this paper is to demonstrate the relationship between intellectual capital and innovative performance, and to specify the boundary conditions and mechanisms of the relationship from a knowledge-based dynamic capability perspective.

This study empirically analyzes the impact of intellectual capital on innovative performance and the role knowledge-based dynamic capability plays with a sample of 217 firms in China. To test the research hypotheses, regression analysis is applied.

The results show that intellectual capital positively affects innovative performance, and knowledge-based dynamic capability is a mediator rather than a moderator which partly mediates the relationship between intellectual capital and innovative performance.

The findings suggest that realizing superior innovative performance is dependent on a firm’s intellectual capital and its ability to sense opportunities and threats, to make timely and correct decisions, and to facilitate necessary changes efficiently.

This study is the first to clarify whether knowledge-based dynamic capability plays a moderating role or a mediating role between intellectual capital and innovative performance. The present study thus helps move forward the understanding on the conditions and mechanisms of the effects of intellectual capital.