The Two Sides of E-Commerce, Selling and Buying: An Empirical Analysis at Firm-Level

The Two Sides of E-Commerce, Selling and Buying: An Empirical Analysis at Firm-Level

Leïla Peltier Ben Aoun (STATEC, Luxembourg) and María Rosalía Vicente (University of Oviedo, Spain)
DOI: 10.4018/978-1-4666-9787-4.ch028
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Background

Diffusion is generally defined as the process by which innovations spread over the economy (OECD & Eurostat, 2005). Understanding the reasons that lead firms to adopt innovations (either new technologies, products or processes) has become one of the major issues for economists since the seminal work of Griliches (1957).

The basic approach to analyze diffusion are epidemic models which state that diffusion is the result of the spread of information from the users of the new technology to the non-users over time (Geroski, 2000). These models rely on two key ideas: firms learn about the new technology from those which are already users and do not get that information at the same time. Such assumptions lead to a path of diffusion similar to an S-curve: at first adoption, takes place slowly; then, as more and more firms use the new technology and share their experiences, the spread of information accelerates and the diffusion speeds up; finally, the market reaches its saturation point and the diffusion rate decreases (Baptista, 1999; Geroski, 2000; Karshenas & Stoneman, 1995).

Key Terms in this Chapter

Ranks Models: A type of models of technology diffusion that emphasizes that the benefits from technological adoption vary across firms depending on their characteristics.

B2B: A kind of e-commerce that involves the commercial transactions that take place between firms (business to business).

Diffusion: The spread of a new technology over the economy.

E-Commerce: Commercial transactions that take place over the internet. It can be analyzed either from the perspective of those selling (e-selling) or those buying (e-buying).

Stock-Effects Models: A type of models of technology diffusion, which considers that firms’ benefits from technological adoption depend on number of previous adopters.

Order-Effects Models: A type of models of technology diffusion, which considers that firms’ benefits from technological adoption depend on number of previous adopters.

Epidemic Models: A type of models of technology diffusion which explains this process as the result of the (contagious) spread of information about the new technology from users to non-users.

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