The main purpose of this study is to examine the concept of Intellectual capital in higher education institutions/universities, justify its importance and its impact on their research output and performance. This study analyzes the impact of Intellectual Capital on university research performance in Taiwan and also compares the intellectual capital of two selected universities. This is an important study of the intellectual research area because the growing interest in intellectual capital has been extended from the firms to higher education institutions during the last decade. The major function of a university is exploring and transmitting knowledge which is acquired through research and education. Therefore assessing university research performance and its intellectual capital is a complex and critical issue. Furthermore intellectual capital has become a major driver for sustainable competitive advantage in all the organizations. A literature review is used to describe the intellectual capital, its components and research performance of the universities; it also highlighted the researchers’ contributions in this area of study. The study uses exploratory approach to develop the conceptual model and raised these research questions with respect to it; Is there a significant impact of intellectual capital and its components on research performance of the university?, which university NTU or NCKU has the greater intellectual capital. These research questions were investigated through empirical research using a case study approach on two large general public sectors universities in Taiwan i.e. NTU and NCKU. Secondary data was used and collected for the study. Descriptive, Ratio and correlation analysis were used to study the intellectual capital of the universities and its impact on their research performance. Our descriptive and Ratio analysis found that NTU has higher and positive values in the all indicators of human, structural and relational capital, which shows that NTU has greater intellectual capital than the NCKU. The results of these techniques also showed that intellectual capital has a significant impact on research performance of the university in general. According to the findings all the components of intellectual capital also has a significant impact on research performance of the university, although human capital was ranked first and most important, followed by structural capital while relational capital ranked last among the components. Additionally the effect of human capital was most influential whereas relational capital did not have a significant impact. The results of this study are useful for the Universities to understand the value of their intellectual capital and exploit them for innovations and efficiency augmentation.
Keywords: Intellectual Capital, Human Capital, Structural capital, Relational capital, Research performance