Sticky Information Technology Investment: Theory and Empirical Evidence
Bibliographic record
Abstract
This article provides a new way of thinking about managerial discretion in information technology (IT) investment decisions. We delve into the existence, antecedents, and consequences of sticky IT investment behavior, an understudied managerial deliberate resource commitment decision in response to changes in sales. Guided by downsizing theory, we initially theorize and find that IT investments exhibit stickiness: IT investments move downward less for sales decreases than they move upward for equivalent increases. Then drawing upon agency theory, adjustment costs theory, and managerial expectations theory—which influence managers’ motivation for downsizing—we predict and demonstrate that managers’ empire-building incentives, their avoidance of adjustment costs, and their optimism regarding future sales strengthen their engagement in sticky IT investments. Furthermore, we introduce and operationalize three novel measures of firm-specific IT investment stickiness that reflect slack IT resources during sales downturns, respectively, capturing the influence of empire-building incentives, adjustment costs, and managerial optimism. Built on these measures, we uncover that the degree of stickiness in a firm's IT investments offers additional insights into predicting future performance, growth in future IT labor, and growth in future sales. Overall, our work formulates an integrative conceptual framework for understanding sticky IT investment that incorporates the presence and antecedents of managers’ asymmetric IT investment decisions, as well as the implications of firm-specific sticky IT investment for forecasting future corporate outcomes. We discuss these findings and their practical and theoretical implications in detail.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.006 | 0.052 |
| Meta-epidemiology (narrow) | 0.001 | 0.001 |
| Meta-epidemiology (broad) | 0.001 | 0.001 |
| Bibliometrics | 0.004 | 0.006 |
| Science and technology studies | 0.001 | 0.005 |
| Scholarly communication | 0.005 | 0.005 |
| Open science | 0.002 | 0.002 |
| Research integrity | 0.002 | 0.003 |
| Insufficient payload (model declined to judge) | 0.008 | 0.001 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".