Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
9735120 | The Journal of High Technology Management Research | 2005 | 13 Pages |
Abstract
This paper draws from behavioral finance theory to provide an alternative explanation to the efficient market hypothesis that investor under- and overreactions occur by chance. Hypotheses propose relationships between information technology/systems outsourcing (hereafter IT/IS) decisions on short- and long-term abnormal returns, while exploring the potentially confounding effect of organizational restructuring events that frequently follow such decisions. Using event studies techniques, it is found that although IT/IS outsourcing announcements are positively related to short-term abnormal returns, restructuring charges after the announcement moderate the relationship between the short-term effect of such announcements and long-term abnormal returns, so that long-term returns become negative when followed by organizational restructuring efforts resulting from IT/IS outsourcing.
Keywords
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Management of Technology and Innovation
Authors
Juan Florin, Marianne Bradford, Don Pagach,