Electronic Networking Technologies, Innovation Misfit, and Plant Performance

Robert G. Fichman and Nigel P. Melville

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: Prior work on information technology (IT) adoption and economic impacts typically employs an instrumental logic in which firms lead with innovation when they possess characteristics that make it economically beneficial to do so and lag when they do not. However, firms may deviate from this idealized picture when they possess characteristics of an innovation laggard but exhibit the behavior of an innovation leader (or vice versa), with implications for the returns to IT investment. This study develops a conceptual framework and hypotheses regarding the implications of such deviations, which we call innovation misfits. Using a data set comprising measures of the adoption of electronic networking technologies (ENT) in over 25,000 U.S. manufacturing plants, productivity regression estimation reveals a consistent pattern that the association between IT and productivity is diminished in the presence of innovation misfit. We discuss the implications of innovation misfit for scholarship and management practice, which are numerous.

Pages: 33 pages
Date: 2010-02
New Economics Papers: this item is included in nep-bec, nep-eff and nep-ino
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https://www2.census.gov/ces/wp/2010/CES-WP-10-03.pdf First version, 2010 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:10-03

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