A Microeconomic approach to the measurement of information technology value

Paul Alpar, Moshe Kim

Research output: Contribution to journalArticlepeer-review


The problem of measuring the impact of information technology on economic performance at the business unit or enterprise level is receiving increased attention. We develop a methodology based on the microeconomic theory of production and apply the model to data from the banking industry. In addition, we compare our methodology to approaches based on key ratios of information technology deployment. Both procedures are applied to the same set of data. The results show that reasoning about information technology value based on key ratios may be misleading, especially when the figures are only calculated for a cross-section of data.

Original languageEnglish
Pages (from-to)55-69
Number of pages15
JournalJournal of Management Information Systems
Issue number2
StatePublished - 1990


  • Key ratios of firm performance and information technology deployment
  • Measurement of information technology value
  • Production in commercial and retail banking
  • Translog cost function

ASJC Scopus subject areas

  • Management Information Systems
  • Computer Science Applications
  • Management Science and Operations Research
  • Information Systems and Management


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