The Role of Disseminative Capacity in HIT Adoption: An Empirical Analysis

Health information technology (HIT) has the potential to significantly reduce medical errors, streamline clinical processes, contain healthcare costs, and ultimately improve the quality of healthcare. Yet, the adoption of HIT among hospitals in the United States has been rather slow. This work synthesizes the theories on social networks and knowledge transfer by introducing the notion of a disseminative capacity to study HIT adoption. We argue that members within a socioeconomic system possess both absorptive and disseminative capacities that influence knowledge transfer among them. Accordingly, a research framework is proposed, in which the absorptive capacity of a potential adopter and the disseminative capacity of connected adopters act as two key determinants, and these two capacities substitute for each other in affecting HIT adoption. Using a large panel dataset covering adoption decisions of over 5,000 hospitals across a 13-year horizon, we find strong support for our hypotheses derived from this framework.