The impact of information systems on organizations and markets
Communications of the ACM
The substitution of information technology for other factors of production: a Firm Level Analysis
Management Science - Special issue: Frontier research on information systems and economics
Disaggregating the return on investment to IT capital
ICIS '98 Proceedings of the international conference on Information systems
Information Technology and Productivity: Evidence from Country-Level Data
Management Science
The Journal of Strategic Information Systems
IT assets, organization capital and market power: Contributions to business value
Decision Support Systems
Journal of Management Information Systems
Information Technology and Intangible Output: The Impact of IT Investment on Innovation Productivity
Information Systems Research
Information Technology and Trademarks: Implications for Product Variety
Management Science
Using data envelopment analysis (DEA) to assess government web portals performance
Proceedings of the 13th Annual International Conference on Digital Government Research
Journal of Management Information Systems
Investments in information systems: A contribution towards sustainability
Information Systems Frontiers
Information Polity - Key Factors and Processes for Digital Government Success
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Prior research at the firm level finds information technology (IT) to be a net substitute for both labor and non-IT capital inputs. However, it is unclear whether these results hold, given recent IT innovations and continued price declines. In this study we extend prior research to examine whether these input relationships have evolved over time. First, we introduce new price indexes to account for varying technological progress across different types of IT hardware. Second, we use the rental price methodology to measure capital in terms of the flow of services provided. Finally, we use hedonic methods to extend our IT measures to 1998, enabling analysis spanning the emergence of the Internet. Analyzing approximately 9,800 observations from over 800 Fortune 1,000 firms for the years 1987--1998, we find firm demand for IT to be elastic for decentralized IT and inelastic for centralized IT. Moreover, Allen Elasticity of Substitution estimates confirm that through labor substitution, the increasing factor share of IT comes at the expense of labor. Last, we identify a complementary relationship between IT and ordinary capital, suggesting an evolution in this relationship as firms have shifted to more decentralized organizational forms. We discuss these results in terms of prior research, suggest areas of future research, and discuss managerial implications. *This paper is dedicated to the memory of Paul Chwelos, respected colleague and dear friend.