Environment and Policy Factors Shaping Global E-Commerce Diffusion: A Cross-Country Comparison

Abstract

This article examines the key global, environmental and policy factors that act as determinants of e-commerce diffusion. It is based on systematic comparison of case studies from 10 countries--Brazil, China, Denmark, France, Germany, Mexico, Japan, Singapore, Taiwan, and the United States. It finds that B2B e-commerce seems to be driven by global forces, whereas B2C seems to be more of a local phenomenon. A preliminary explanation for this difference is that B2B is driven by global competition and MNCs that "push" e-commerce to their global suppliers, customers, and subsidiaries. This in turn creates pressures on local companies to adopt e-commerce to stay competitive. In contrast, B2C is "pulled" by consumer markets, which are mainly local and therefore divergent. While all consumers desire convenience and low prices, consumer preferences and values, national culture, and distribution systems differ markedly across countries and define differences in local consumer markets. These findings support the transformation perspective about globalization and its impacts. In terms of policy, the case studies suggest that enabling policies such as trade and telecommunications liberalization are likely to have the biggest impact on e-commerce, by making ICT and Internet access more affordable to firms and consumers, and increasing pressure on firms to adopt e-commerce to compete. Specific e-commerce legislation appears not to have as big an impact, although inadequate protection for both buyers and sellers in some countries suggests that mechanisms need to be developed to ensure greater confidence in doing business online.