Information and Profitability Estimates: Modelling the Firm's Decision to Adopt a New Technology

This paper uses a response surface based on catastrophe theory to examine the interaction of information and profitability estimates on the firm's adoption of a new technology or innovation. As such, the paper builds on the conceptual ideas behind McCardle's (1985) work. An illustrative example using simulated data is presented to indicate how one might operationalize the key constructs for the purpose of estimating the model.