| This dissertation investigates the economic incentives and managerial considerations governing the adoption of information technology by firms. Both the drivers of IT adoption and the determinants of decision rights over that adoption are empirically examined using detailed micro data collected by the US Census Bureau and combined with proprietary data from Harte Hanks, Inc.;While IT adoption and its implications for competitiveness have been widely studied by economists and strategy researchers, the position of a firm in its particular market context is largely overlooked in the empirical literature. Chapter 1 addresses this gap by considering whether market leaders are likely to be leading adopters of IT-driven process innovations and why. The empirical context is adoption of e-buying and e-selling by US manufacturing plants in 2000. Using a probit model of adoption, evidence of a positive relationship between leadership and adoption is found for e-buying, but not for e-selling. Overall results are consistent with economies of scale for both technologies; however strategic and technological considerations differentially impact the returns from adoption for plants with higher market share and/or relative productivity.;Adoption is generally considered to be a choice of a unitary firm actor maximizing profits for the organization. However, actual IT investment decisions within multi-establishment firms are often delegated to local managers. Chapter 2 empirically tests a simplified model (based on Dessein and Santos, 2006) of how demands for specialization and coordination influence delegation. The empirical context is decision rights over IT systems purchasing by US manufacturers. Results suggest that delegation is more likely the greater the informational advantages of local managers; however, the likelihood of centralization increases with the economic value of intra-firm coordination. Establishments with large contributions to firm revenues are, by far, more likely to have discretion---indicating the centrality of organizational asymmetry and within-firm linkages and in determining decision rights in this context.;Chapter 3 investigates the impact of aggregation in testing firm-level theories with establishment-level data, with applications to the chapter 2 analysis. In general, aggregation assumptions are not innocuous and straightforward procedures can mask critical within-firm heterogeneity, resulting in biased coefficients and interpretation challenges. |
