Review of Global Electronic Commerce: A Policy Primer

As the title suggests, the book deals with the role of the government in developing policies for electronic commerce. E-commerce has been an extremely hot topic in the recent years. The economic opportunities promised by e-commerce have seduced everybody around the world. Mann and her colleagues at the Institute for International Economics have taken the difficult task of defining the proper role of government in this area. E-commerce has been defined on a much broader scale than the situations exemplified by my buying books from Amazon.com, or my teenage daughter downloading MP3 music files. E-commerce “encompasses a complex of technologies, infrastructures, processes and products” bringing together producers and users in a global marketplace. The growth of the Internet has been attributed to three factors: 1) rapid decline in information technology products, both hardware and software; 2) interoperable technology platforms; 3) commercialization of the web with media-rich content. While e-commerce is expected to make revolutionary changes in business, this will also create many disruptions in the process. The major source of economic benefit from e-commerce is due to network effect—more people are connected to the network, more people is the benefit. Rapid changes in technology are making transactions faster and, thus, creating new market opportunity. Information is an important source of value in this process. According to Mann et al., two guiding principles should determine the government interventions: policy of interoperability, and preserving private-sector initiatives to augment and innovate existing network capabilities. The central theme in this book is that the role of the government is to create and nurture a facilitating environment in which local and foreign entrepreneurs can thrive. The authors argue that the government is not suited to make the technical determinations, and it is best that private initiatives are fostered for technological developments. The government, indeed, has a major role to play in several areas of infrastructure related to e-commerce: communication systems; financial systems; and systems for distribution and delivery. Traditionally, the government owned and operated communication systems. In the U.S., the government did not own, but heavily regulated and main