Essays on the management of information and technology

This dissertation consists of two independent essays on the management of information and technology.; In the first essay, we examine the procurement process design and selection problem in a private procurement market where a large industrial buyer can use reverse auctions to improve the efficiency of her procurement process. We derive the optimal quantity, the optimal number of suppliers to be sourced from and contract selection strategies for a standard single-stage reverse procurement auction process and a two-stage process in which an additional contracting stage follows the auction event. We show that the optimal number of suppliers tends to increase with production scalability and decrease with cost uncertainty for the single-stage process. Furthermore, both processes are asymptotically optimal as the number of eligible suppliers increases or the production scalability decreases. However, as the production scalability increases or the demand increases, both processes suffer inefficiencies. Examining the effect of contracting costs, we find that a two-stage process is preferable to a single-stage process when cost uncertainty, consumer demand or production scalability is high or the number of eligible suppliers is limited, whereas sole sourcing is preferable to multiple sourcing when production cost uncertainty is relatively high compared to demand uncertainty.; In the second essay, we study the economics of digital goods piracy. Threatened by the growth of individual piracy of digital goods, the information goods industry took legal action by suing the file-sharing (P2P) networks and the consumers who illegally share copyrighted material on these networks. We demonstrate that each one of these two actions aimed to fight individual piracy can backfire by providing strategic disadvantage to the information goods producers. In particular, we show that in the presence of commercial piracy (i) a higher population of consumers who are capable of individual piracy can increase a legal publisher's profits; and (ii) a higher detection and prosecution rate for individual piracy can reduce a legal publisher's profits. Our results suggest that information goods producers may be better off by considering their copyright protection policies from a more strategic point of view.