ssrn-id838264 - Mieczysaw Dobija Theories of Chemistry and...

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Mieczys ł aw Dobija Theories of Chemistry and Physics Applied to Developing an Economic Theory of Intellectual Capital Abstract Successful entrepreneurs employ a variety of assets with the objective of seeking unusually high returns on invested financial capital. Intellectual entrepreneurs effectively use some intangible factors, like intellectual capital, to reach impressive results. Each asset employed by entrepreneurs involves a category of capital. Capital, in its sense of being used to “do something” is analogous to a property in physical science that is labelled as ‘energy.’ Energy is often defined as “the capacity to do work.” And thermodynamics is a field in which the applications of energy and heat are thoroughly studied. Thermodynamics provides a useful analogy for understanding intellectual capital. Intellectual capital is best described as a low entropic component involving both the human mind and human spirit in will-directed actions that forms a special quality of intellectual entrepreneurship. The second law of thermodynamics is a key to understanding the properties of energy and is used as a prime analogy for understanding capital and its theories. 1. What is capital? Although the term is widely used in economics and finance, it is productive to consider some of the differences in how the term is used. Simply because a term enjoys popular use does not mean that it enjoys the status of a scientific convention. In 1975, Bliss (p. 7) wrote: "... When economists reach agreement on the theory of capital they will shortly reach agreement on everything. Happily, for those who enjoy a diversity of views and beliefs, there is very little danger of this outcome. Indeed, there is at present not even agreement as to what the subject is about…" The term capital has been used as early as in thirteenth century. In 1921, E. Cannan offered the following explanation of capital: “...It would not have been at all surprising if the adjective capitalis, formed by the Romans from their substantive caput, which is the Latin for our substantive "head", had been applied by them to many different things. We ourselves, using 1
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"head" adjectivally or in composition with a hyphen, talk of head-keepers, head- offices, head-quarters and many other “head” things. But, if the dictionaries are to be trusted, Latin writers of the classical period generally confined their use of capitalis to the sense in which we, following them, use the adjective "capital" in applying it to crimes and punishments in the sense of "having to do with life." But they did sometimes use it in what to us, with our belief that the head is the seat of personality, seems the more obvious sense of "most important.". ..Now if we ask ourselves what is the chief sum of money dealt with in any particular business, whether that business is carried on by an individual or by a small number of partners such as we call a firm or by a larger number of partners such as we call a company, the answer is "the sum which is the foundation of the business, the
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This note was uploaded on 10/24/2011 for the course SCIENCE PHY 453 taught by Professor Barnard during the Winter '11 term at BYU.

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ssrn-id838264 - Mieczysaw Dobija Theories of Chemistry and...

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