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Past research studies have identified multiple factors that affect the return on investments in information and communication technologies (ICT). We suggest that the efficiency of utilization of investments is also among the variables that can influence the level of returns and propose to investigate factors that can affect the efficiency of transformation of investments into macroeconomic outcomes. We conduct this research in the context of 18 transition economies (TE) and investigate how efficiently TEs utilize investments in telecoms to produce revenues, and what factors contribute to the efficiency of the investment utilization. We rely on a neoclassical framework of growth according and theory of complementarly to provide a theoretical foundation for our inquiry. This study employs a three-phase methodology utilizing data envelopment analysis, chister analysis, and decision trees to identify 15 factors that affect the efficiency of the utilization of investments in telecoms in the context of TEs. C 2008 Wiley Periodicals, Inc.