The Structure of Adjustment Costs in Information Technology Investment

Hyunbae Chun and Sung-Bae Mun ()
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Sung-Bae Mun: Korea Information Strategy Development Institute

Economics Bulletin, 2005, vol. 5, issue 4, 1-9

Abstract: We examine the pattern of information technology (IT) capital adjustment using data from U.S. industries. Using the gap between actual and desired IT capital stocks, we estimate the shape of the adjustment cost function in IT investment. Both ordinary least squares and nonparametric regression estimates support irreversibility in IT investment.

JEL-codes: E2 O3 (search for similar items in EconPapers)
Date: 2005-07-14
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