Even assuming the physical infrastructure bottlenecks to Internet expansion are overcome and access prices become more affordable in developing countries, a number of other significant policy challenges must be met if governments are to create an environment conducive to e-commerce. E-commerce requires legal norms and standards (covering, for example, contract enforcement, consumer protection, liability assignment, privacy protection, intellectual property rights) and process and technical standards (e.g. regarding the way payments are accepted on the Internet and products are delivered to the final user, security, authentication, digital signatures, and connectivity protocols).
As regards Internet-related technologies, it seems virtually inevitable that many of the norms and standards defining the e-commerce environment will be forged in the more advanced countries. “Standing on the shoulders of giants” makes sense when network externalities and interoperable standards are key to maximising the benefits of e-commerce (Mann, 2000b). Besides an enabling policy environment, merchandise e-commerce also requires complementary physical infrastructure, notably a logistics system capable of timely, secure, and affordable small batch shipping to multiple destinations. The cost for delays can be high even in the United States. A recent BCG study revealed that 19 per cent of online customers said the delivery of their orders either took longer than they expected or never occurred. As a result, many stopped shopping online, while others refused to do more business with the offending e-tailer35.
OECD DEVELOPMENT CENTRE Working Paper No. 164 E-COMMERCE FOR DEVELOPMENT: PROSPECTS AND POLICY ISSUES by Andrea Goldstein and David O’Connor
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Created in 1962 by the Organisation for
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international community. It is a forum
where countries come to share their
experience of economic and social
development policies. The Centre
contributes expert analysis to the
development policy debate. The objective
is to help decision makers find policy
solutions to stimulate growth and improve
living conditions in developing and
emerging economies.
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