importance of intangible assets for the valuation of companies raises a
of questions. How can we value knowledge-intensive and hence human capital intensive firms
appropriately? Traditional valuation and accounting techniques have limited applicability in this context
and have to be modified to account for recent developments.
"Human Capital Pricing Model (HCPM)"
enables both researchers and mangers to value human capital and investments in human capital using capital market theory in a risk-adjusted manner. The approximate quantification of return on human capital should further improve the optimal allocation of funds in the firm and thereby increase shareholder value.