A Criticism On Value Added Intellectual Coefficient (Vaic) Model

Value Added Intellectual Coefficient (VAIC) is one of the methods that have so far been used to calculate the degree of intellectual capital coefficients. Value Added Intellectual Coefficient (VAIC) that was presented in 2000 by Pulic measures the efficiency of three types of data: used capital (financial and physical), human capital and structural capital. Pulic has named the three efficiencies in his method as independent variables and has used Return on Assets (ROA), Return on Equity (ROE), Earnings per Share (EPS) and Enhanced Productivity (EP) variables as dependent variables. Many criticisms were made about Pulic's method among which the type of considered independent variables, i. e., the three efficiencies could be named as in fact the efficiency of physical, human and structural capitals have been calculated and they have nothing to do with the intellectual capital. Also as far as evaluation of VAIC method is concerned, the relationship among independent variables will not create any serious problem by itself. To explain the issue in details, the problems and criticisms made about VAIC method will be noted and in order to confirm the claim, a quantitative sample in a case study will be taken into account.