IT Investments, Intangibles, and Financial Performance, Revisited: A RBV-Based Empirical Analysis

27 Pages Posted: 18 Apr 2016  

Carlos Piñeiro-Sánchez

University of Coruña - Dept. of Financial Economics & Accountability. Financial Management & Information Systems Research Group (fysig)

Pablo de Llano-Monelos

University of Coruña - Faculty of Business and Economics

Manuel Rodríguez - López Sr.

University of Coruña - Finance and MIS Research Group (fysig)

Date Written: April 16, 2016

Abstract

Drawing on the resource - based view of the firm (RBV), this study aims at evaluating the relation between current IT resources and capabilities and corporate performance, as measured by the probability of default. We use a novel experimental design to move towards a prospective approach, and make predictions about whether current IT resources and capabilities will affect future financial performance. We provide evidence that the ability of the company to survive as an independent economic unit is modified by IT decentralization, flexibility, and the development of synergistic bundles of IT resources and capabilities, once controlled for dimension, industry, and financial resources. Our findings are compatible with time lags and long-term effects on financial performance previously reported by IT literature. We also provide evidence that the ability to survive is a suitable measure of performance, within the RBV frame.

Keywords: IT investments, resource-based theory, financial performance

JEL Classification: Q33, M21, C52

Suggested Citation

Piñeiro-Sánchez, Carlos and de Llano-Monelos, Pablo and Rodríguez - López, Manuel, IT Investments, Intangibles, and Financial Performance, Revisited: A RBV-Based Empirical Analysis (April 16, 2016). Available at SSRN: https://ssrn.com/abstract=2765475 or http://dx.doi.org/10.2139/ssrn.2765475

Carlos Piñeiro-Sánchez (Contact Author)

University of Coruña - Dept. of Financial Economics & Accountability. Financial Management & Information Systems Research Group (fysig) ( email )

Campus de Elviña
A Coruña, A Coruña E15071
Spain

HOME PAGE: http://www.udc.es/grupos/fysig/carlos

Pablo De Llano-Monelos

University of Coruña - Faculty of Business and Economics ( email )

Campus Elviña s/n
A Coruña, Galicia 15071
Spain

Manuel Rodríguez - López Sr.

University of Coruña - Finance and MIS Research Group (fysig) ( email )

Campus de Elviña
http://www.udc.es/grupos/fysig
A Coruña, A Coruña E15071
Spain

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