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Motivation for the Paper

How much does Relational Capital matter during the Crisis ? E. Kuminova A.Bykova The Changing Role of Intangibles over the Crisis. Motivation for the Paper. Strong and close relationships are considered as one of the most promising areas within the modern firm theory

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Motivation for the Paper

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  1. How much does Relational Capital matter during the Crisis?E. KuminovaA.BykovaThe Changing Role of Intangibles over the Crisis

  2. Motivation for the Paper • Strong and close relationships are considered as one of the most promising areas within the modern firm theory • Focus on investigation of particular IC component: the transformation of relational capital resources into company value • Does relational capital become more relevant for the process of value creation during the crisis?

  3. Motivation for the Paper 2 • Evidenence during the crisis: Dependence on the foreign capital led to the bancruptsy (at least decline of financial results) • Contradictory facts about business associations (BA): • the negative effect for companies who are in the strong dependence on their partners • the minimization of and transaction costs and uncertainty caused by market failure Foreign capital employed has the negative impact on the value creation during the global economic crisis Participation in BA positively correlates with the value creation in terms of the strong financial constraints

  4. RC Definition: several directions to the analysis • RC as potential source for company’s financial prosperity: market, power, and cooperation links • Internal features and structure of RC or social capital • RC includes both the internal and the external dimensions

  5. Market value added Time-varying exogenous indicators Time-varying exogenous indicators Time-invariant endogenous indicators Brand Power Business Associations Location in agglomeration Foreign capital Top-universities Control parameters Company age EVA Time period Number of employees Real GDP growth rate Industry Research Framework: using HT-specification

  6. The analytical model for hypotheses where: • Tvexogenous are time-varying exogenous variables; • Tvendogenous are time-varying endogenous variables; • Tiexogenous are time-invariant exogenous variables; • εitis a vector of errors; • t is a time period (for panel data) • NB! + Bootstrapmethod (2000 replications )

  7. Estimation Results

  8. Estimation Results

  9. Empirical evidence: • The positive impact of all relational capital inputs, excluding agglomeration effect • Foreign capital employed is even more important for company value during the crisis period

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