What Do You Know? Rational Expectations in Information Technology Adoption and Investment

Journal of Management Information Systems

Volumn 20, Issue 2, 2003, Pages 49-76

  Au, Yoris A ^a   Kauffman, Robert J ^b  

^a UNIVERSITY OF TEXAS AT SAN ANTONIO   (United States)

^b NONE

Author keywords

Adaptive learning; Business value; Herd behavior; Information technology investments; Informational cascades; Rational expectations hypothesis; Technology adoption

Indexed keywords

ADAPTIVE SYSTEMS; DECISION MAKING; INDUSTRIAL ECONOMICS; INFORMATION TECHNOLOGY; INVESTMENTS;

ADAPTIVE LEARNING; TECHNOLOGY ADOPTION;

MANAGEMENT INFORMATION SYSTEMS;

EID: 0242657755     PISSN: 07421222     EISSN: None     Source Type: Journal    
DOI: 10.1080/07421222.2003.11045764     Document Type: Review

References (61)

1. Accenture. Exclusive Accenture global survey confirms growing dominance of Web services: Web services adoption survey. Accenture, Boston, April 8, 2003 (available at www.accenture.com/xdoc/en/services/web/insights/web_survey.pdf).
2. Au, Y.A., and Kauffman, R.J. Should we wait? Network externalities, compatibility, and electronic billing adoption. Journal of Management Information Systems, 18, 2 (Fall 2001), 47-63.
3. Banerjee, A.V. A simple model of herd behavior. Quarterly Journal of Economics, 107, 3 (August 1992), 797-817.
4. Benaroch, M., and Kauffman, R.J. Justifying electronic banking network expansion using real options analysis. MIS Quarterly, 24, 2 (June 2000), 197-225.
5. Bielski, L. Hard to get the online habit. ABA Banking Journal, 95, 2 (February 2003), 79-82, 86 (available at www.parsintl.com/pdf/5655-ABA.pdf).
6. Bikchandani, S., and Sharma, S. Herd behavior in financial markets. IMF Staff Papers, 47, 3 (September 2000), 279-310.
7. Bikchandani, S.; Hirshleifer, D.; and Welch, I. A theory of fads, fashion, custom, and cultural change as informational cascades. Journal of Political Economy, 100, 5 (October 1992), 992-1026.
8. Bikchandani, S.; Hirshleifer, D.; and Welch, I. Learning from the behavior of others: Conformity, fads and informational cascades. Journal of Economic Perspectives, 12, 3 (Summer 1998), 151-170.
9. Blattberg, R.C., and Wisniewski, K.J. Price-induced patterns of competition. Marketing Science, 8, 4 (Fall 1989), 291-309.
10. Brynjolfsson, E., and Kemerer, C.F. Network externalities in microcomputer software: An econometric analysis of the spreadsheet market. Management Science, 42, 12 (December 1996), 1627-1647.
11. BusinessWeek. Wi-Fi is like the Internet itself: Interview with Nicholas Negroponte. BusinessWeek Online, April 28, 2003 (available at www.businessweek.com/magazine/content/03_17/b3830613.htm).
12. Choi, J.P. Herd behavior, the "penguin effect," and the suppression of informational diffusion: An analysis of informational externalities and payoff interdependency. RAND Journal of Economics, 28, 3 (Autumn 1997), 407-425.
13. Choi, J.P., and Thum, M. Market structure and the timing of technology adoption with network externalities. European Economic Review, 42, 2 (February 1998), 225-244.
14. Conlisk, J. Why bounded rationality? Journal of Economic Literature, 34, 2 (June 1996), 669-700.
15. Crawford, V.P. Lying for strategic advantage: Rational and boundedly rational misrepresentation of intentions. American Economic Review, 93, 1 (March 2003), 133-149.
16. Dai, Q. Understanding the performance of B2B electronic markets. Ph.D. dissertation, Carlson School of Management, University of Minnesota, Minneapolis, 2003.
17. Dove Consulting. Electronic payment instruments study: Summary report. Paper prepared for Federal Reserve System's Retail Payment Office, Washington, DC, December 2001 (available at www.aba.com/NR/rdonlyres/00004b26kodjiblxezcvchub/Electro91.ppt).
18. Emtec, Inc. E-billing and payments gaining momentum. Emtec Advisor, 5, 6 (December 2002-January 2003) 10 (available at www.emtecinc.com/Dec02Adviser.pdf).
19. Evans, G.W., and Honkapohja, S. Learning and Expectations in Macroeconomics. Princeton: Princeton University Press, 2001.
20. Farrell, J., and Gibbons, R. Cheap talk with two audiences. American Economic Review, 79, 5 (December 1989), 1214-1223.
21. Farrell, J., and Rabin, M. Cheap talk. Journal of Economic Perspectives, 10, 3 (Summer 1996), 103-118.
22. Farrell, J., and Saloner, G. Standardization, compatibility, and innovation. RAND Journal of Economics, 16, 1 (Spring 1985), 70-83.
23. Farrell, J., and Saloner, G. Installed base and compatibility: Innovation, product preannouncements, and predation. American Economic Review, 76, 5 (December 1986), 940-955.
24. Frydman, R. Towards an understanding of market processes: Individual expectations, learning, and convergence to rational expectations equilibrium. American Economic Review, 72, 4 (September 1982), 652-668.
25. Geanakoplos, J.D. Common knowledge. Journal of Economic Perspectives, 6, 4 (Fall 1992), 53-82.
26. Geanakoplos, J.D., and Polemarchakis, H.M. We can't disagree forever. Journal of Economic Theory, 28, 1 (October 1982), 192-200.
27. Green, H.; Rosenbush, S.; Crockett, R.O.; and Holmes, S. Wi-Fi means business. BusinessWeek, 3830 (April 28, 2003), 86-92.
28. Grossman, S.J. An introduction to the theory of rational expectations under asymmetric information. Review of Economic Studies, 48, 4 (October 1981), 541-559.
29. Hwang, S., and Salmon, M. A new measure of herding and empirical evidence. Working paper WP01-3, Financial Econometrics Research Center, City University Business School, London, 2001.
30. Jensen, R. Adoption and diffusion of an innovation of uncertain probability. Journal of Economic Theory, 27, 1 (June 1982), 182-193.
31. Katz, M.L., and Shapiro, C. Network externalities, competition, and compatibility. American Economic Review, 75, 3 (June 1985), 424-440.
32. Katz, M.L., and Shapiro, C. Technology adoption in the presence of network externalities. Journal of Political Economy, 94, 4 (August 1986), 822-841.
33. Kauffman, R.J., and Wang, Y. The network externalities hypothesis and competitive network growth. Journal of Organizational Computing and Electronic Commerce, 12, 1 (Winter 2002), 59-83.
34. Kauffman, R.J.; McAndrews, J.; and Wang, Y. Opening the "black box" of network externalities in network adoption. Information Systems Research, 11, 1 (March 2000), 61-82.
35. Keane, M.P., and Runkle, D.E. Are financial analysts' forecasts of corporate profits rational? Journal of Political Economy, 106, 4 (August 1998), 768-805.
36. Lohmann, S. I know you know he or she knows we know you know they know: Common knowledge and the unpredictability of informational cascades. In D. Richards (ed.), Political Complexity: Non-Linear Models of Politics. Ann Arbor: University of Michigan Press, 2000, pp. 137-173.
37. Lucas, R.E., Jr. Expectations and the neutrality of money. Journal of Economic Theory, 4, 2 (April 1972), 103-124.
38. Lucas, R.E., Jr. An equilibrium model of the business cycle. Journal of Political Economy, 83, 6 (December 1975), 1113-1144.
39. Lucas, R.E., Jr., and Sargent, T.J. (eds.). Rational Expectations and Econometric Practice. Minneapolis: University of Minnesota Press, 1981.
40. Malik, M. Here to stay: The future of XML in financial services. Wall Street and Technology Online, May 14, 2002 (available at www.wallstreetandtech.com/story/WST20020514S0004/).
41. Metavante Corporation. Metavante acquires Derivion and CyberBills. Press release, Metavante Corporation, Milwaukee, WI, August 2002 (available at www.metavante.com/content/detail/epp/popup.html).
42. MobileInfo.com. Embedded Wi-Fi chips in handhelds: Blessing with a cautionary note. MobileInfo.com News, 35, 2002 (September 2002) (available at www.mobileinfo.com/News_2002/Issue35/EmbeddedWiFi.htm).
43. Morgan Stanley Dean Witter. Catching the third wave: An industry report on Internet and financial services. Research report, Equity Research, North America, Morgan Stanley Dean Witter, New York, April 14, 2000 (available at www.snlcenter.com/analyst_training/2000/doc26.pdf).
44. Muth, J.F. Rational expectations and the theory of price movements. Econometrica, 29, 3 (July 1961), 315-335.
45. Nerlove, M. Adaptive expectations and cobweb phenomena. Quarterly Journal of Economics, 72, 3 (May 1958), 227-240.
46. Pesaran, M.H. The Limits to Rational Expectations. Oxford, UK: Basil Blackwell, 1987.
47. Routledge, B.R. Adaptive learning in financial markets. Review of Financial Studies, 12, 5 (Winter 1999), 1165-1202.
48. Sargent, T.J. Bounded Rationality in Macroeconomics. Oxford: Oxford University Press, 1993.
49. Sargent, T.J., and Wallace, N. Rational expectations and the theory of economic policy. Journal of Monetary Economics, 2, 2 (April 1976) 169-183.
50. Schwartz, H. Rationality Gone Awry? Decision Making Inconsistent with Economic and Financial Theory. Westport, CT. Praeger, 1998.
51. Shapiro, C., and Varian, H.R. Information Rules: A Strategic Guide to the Network Economy. Boston: Harvard Business School Press, 1999.
52. Sheffrin, S.M. Rational Expectations, 2d ed. Cambridge: Cambridge University Press, 1996.
53. Simon, H.A. Models of Man. New York: John Wiley & Sons, 1957.
54. Sims, C. Macroeconomics and reality. Econometrica, 48, 1 (January 1980), 1-48.
55. Spectrum EBP. Metavante to acquire Spectrum, an open interoperable switch for exchanging bills and payments online. Press release, Spectrum EBP LLC, Atlanta, GA, July 29, 2002.
56. Stenbacka, R., and Tombak, M.M. Strategic timing of adoption of new technologies under uncertainty. International Journal of Industrial Organization, 12, 3 (September 1994), 387-411.
57. Stoneman, P., and Ireland, N. The role of supply factors in the diffusion of new process technology. Economic Journal, 93, supplement: conference papers (1983), 66-78.
58. T-Mobile USA, Inc. Kinko's and T-Mobile to offer wireless broadband Wi-Fi Internet access at Kinko's locations nationwide. Press release, T-Mobile USA, Inc., Bellevue, WA, April 14, 2003 (available at www.t-mobile.com/company/pressroom/pressrelease67.asp).
59. Tower Group. Making EBPP and EIP adoption happen. Research report, Research and Advisory Services, Tower Group, Needham, MA, November 4, 2002 (available at www.towergroup.com/public/ras/default_ras.asp).
60. Tower Group. Benchmarking the online bill payment industry: Results of the 2002 survey conducted by Tower Group and the NACHA Council for Electronic Billing and Payment. Research report, Research and Advisory Services, Tower Group, Needham, MA, December 12, 2002 (available at www.towergroup.com/public/ras/default_ras.asp).
61. Wi-Fi Alliance. Wi-Fi is everywhere: Wi-Fi Alliance overview. Presentation prepared for NIST briefing, Wi-Fi Alliance, April 2003 (available at csrc.nist.gov/wireless/S09_Wi-Fi%20Alliance%20Overview-01-part2-ff.pdf).