The new productivity paradox

Mark C. Anderson, Rajiv D. Banker, Sury Ravindran

Research output: Contribution to journalReview articlepeer-review

79 Scopus citations


An identification and evaluation of the possible explanations for the high market valuation of Y2K spending is presented. A market-valuation model is used to determine the valuation multiple on Y2K spending of the sample fortune 1000 firms on March 31, 1999. The multiple on Y2K spending of 62.10 for March 31, 1999 indicates that about $60 of firm value was associated with each $1 of Y2K spending. Due to the high costs of remediating and maintaining legacy systems, many companies were also found to use the Y2K opportunity to replace an existing cluster of legacy systems with an enterprise resource planning (ERP) system integrating various internal applications through a common data base.

Original languageEnglish (US)
Pages (from-to)91-94
Number of pages4
JournalCommunications of the ACM
Issue number3
StatePublished - Mar 2003

ASJC Scopus subject areas

  • General Computer Science


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