Abstract

This study is a spatially explicit examination of the role of distance from parent headquarters and local norms on the IT profile of a location at the establishment-level. Prior research has hypothesized that physical distance plays a key role in explaining differences in adoption rates of internet technology between urban versus rural establishments. Here, since distance is viewed as playing a key role, we explicitly test the effect of distance. In addition, instead to testing to adoption of a single technology, we examine the propensity to adoption similar aggregate technology portfolios. Doing so will help distinguish the extent of influence that flows from different channels of diffusion. Specifically, we ask: how is IT adoption affected by the interaction between firm attributes, spatial proximity and shared social structures? Using a database of the IT assets of 1,275 establishments from 461 firms, we develop a vector measure to capture the heterogeneity of an IT portfolio and use it to test our hypotheses. This paper presents the initial results of a quick approximation of the model.

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