Summary
The authors provide a recent account of the diffusion of electronic business in the U.S. economy using new data from the U.S. Bureau of the Census. They document the extent of the diffusion in three main sectors of the economy: retail, services, and manufacturing. For manufacturing, they also analyze plants' patterns of adoption of several Internet-based processes and conclude with a look at the future of the Internet's diffusion and a prospect for further data collection by the U.S. Census Bureau.
See the full content of this document
Extract
The Diffusion of Electronic Business in the United States
The commercial use of the Internet has been diffusing rapidly among consumers and businesses in the United States. As the dust of the shakeout in Internet-based industries settled, both firms and consumers started to increase their understanding of what the Internet is capable of and which Internet businesses are likely to be viable. Partly because of the much-publicized mass withdrawal of many firms from the Internet retail industry during most of 2000 and 2001, the Internet's effect on the retail industry has been the focus of both the popular press and academic research. Internet retailing, however, still represents only a very small fraction of online economic activity. In fact, the volume of business-to-business electronic commerce (e-commerce), representing online transactions within and across firms, is far ahead of the volume of business-to-consumer e-commerce, and it has been transforming the way many business transactions are carried out inside and outside of the firm.
Firms are increasingly finding new uses for the Internet-in the retail, services, and manufacturing industries-ranging from applications at the early stages of production, such as communicating and making transactions with suppliers, to post-sales applications, such as providing online customer service and support. Despite the growing volume of e-commerce in these sectors, little is known about the extent to which the Internet is facilitating various transactions and processes at the individual plant and firm levels. This lack of knowledge can in turn be attributed to a lack of systematic establishment-level data on firms' Internet usage. Earlier reviews of the diffusion of electronic business (e.g., Bakos, 2001, and Lucking-Reiley and Spulber, 2001) have provided excellent accounts of the initial stages of the diffusion. Nevertheless, these studies lack any systematic analysis of data and rely mostly on anecdotal evidence. A more detailed and updated look is required, as changes have taken place rapidly in recent years and several new considerations have become relevant.In this article, we provide a recent account of the diffusion of the Internet in manufacturing, retail, and services. The data we use come from the U.S. Census Bureau's E-stats Program (available online at www.census.gov/esta...See the full content of this document
Sponsored links
