Justifying investments in new information technologies
Journal of Management Information Systems
Recent applications of economic theory in Information Technology research
Decision Support Systems
Managing risks in IT projects: an options perspective
Information and Management
Advanced topics in information resources management
Rental software valuation in IT investment decisions
Decision Support Systems
A real option analysis approach to evaluating digital government investment
dg.o '05 Proceedings of the 2005 national conference on Digital government research
Journal of Management Information Systems - Special issue: Impacts of information technology investment on organizational performance
Valuing information technology infrastructures: a growth options approach
Information Technology and Management
A decision support model for optimal timing of investments in information technology upgrades
Decision Support Systems
Information Technology Investment Strategies Under Declining Technology Cost
Journal of Management Information Systems
Active ERP implementation management: A Real Options perspective
Journal of Systems and Software
Decision-Theoretic and Game-Theoretic Approaches to IT Security Investment
Journal of Management Information Systems
Evaluate IT Investment Opportunities Using Real Options Theory
Information Resources Management Journal
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Justification of investments in information technologies is an important research topic in the information systems area. Several approaches have been proposed. One of these highlights the deficiencies of traditional economic justification based on net present value, and proposes the use of techniques based on financial option pricing theory. This paper examines the relationship between project risk and option values of investments in new information technologies and illustrates how this relationship is significantly different from well-known results in the case of financial option pricing. Conditions for determining the desirability of risky projects are derived.