nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2009‒11‒21
one paper chosen by
Walter Frisch
University Vienna

  1. Information Technology, Capabilities and Asset Ownership: Evidence from Taxicab Fleets By Evan Rawley; Tim Simcoe

  1. By: Evan Rawley; Tim Simcoe
    Abstract: We examine how information technology (IT) influences asset ownership through its impact on firms’ and agents’ capabilities. In particular, we propose that when IT is a substitute for agents’ industry-specific human capital, IT adoption leads to increased vertical integration. We test this prediction using micro data on vehicle ownership patterns from the Economic Census during a period when computerized dispatching systems were first adopted by taxicab firms. The empirical tests exploit exogenous variation in local market conditions, to identify the impact of dispatching technology on firm asset ownership. The results show that firms increase the proportion of taxicabs owned by 12% when they adopt new computerized dispatching systems. The findings suggest that firms increasingly vertically integrate when they acquire resources that substitute for their agents’ capabilities.
    Date: 2009–11

This nep-ict issue is ©2009 by Walter Frisch. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.