An Exploratory Study of the Emerging Role of Electronic Intermediaries

Bailey, Joseph P.; Bakos, Yannis

doi:10.1080/10864415.1997.11518287

Cited by 483 publications

(278 citation statements)

References 10 publications

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“…In order to manufacture the product, the buyer needs a specialized part (henceforth called the part). Manufacturing the part requires a commodity input 5 (henceforth called the commodity). The commodity is supplied by a set of m competing tier-2 suppliers.…”

Section: Modelmentioning

confidence: 99%

“…This suggests that intermediaries have innate strengths, such as providing aggregation (Bhargava and Choudhary, 2004), trust, lower operating costs, and matching services (Bailey and Bakos, 1997) that enable them to add value despite the presence of electronic markets and other IOS. We condense these innate advantages of intermediaries into the notion that they initially have lower search costs than the manufacturer.…”

Section: Introductionmentioning

confidence: 99%

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Electronic Markets, Search Costs and Firm Boundaries

Shankar

Sundararajan

2005

SSRN Journal

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Abstract. We study how electronic markets that facilitate broader inter-firm transactions affect the vertical scope of emerging IT-enabled extended enterprises. We do so by modeling firms in a three-tier value chain who are each connected to a common electronic market that facilitates direct business transactions across tiers, and that lowers the search costs associated with finding an appropriate trading partner for each of them. The extent to which search costs are reduced depends on the complexity of B2B search, and the nature of the supporting technologies that the electronic market facilitates. Variation in search costs affect firms across the value chain in three key ways: by a change in the transaction costs of interaction between firms; by a change in the contracting costs associated with outsourcing owing to changes in the costs of moral hazard for delegated search, and by a change in the price dispersion of upstream input commodities. We capture each of these effects in a new model that integrates search theory into the principal-agent framework, and establish that the optimal outsourcing contract has a simple "all or nothing" performance-based structure under fairly general assumptions. We then apply this model to contrast the effect that different information technologies have on the relative B2B search costs of different firms in the value chain, contrasting the predicted changes of proportionate, constant and convergent changes in search costs. When integrated with a detailed analysis of the nature of B2B search, these results predicts that when B2B search is information-intensive, electronic markets will facilitate an increase in outsourcing, market-based transactions and a reduction in the vertical scope of extended enterprises. In contrast, when B2B search is primarily communication-intensive, electronic markets will lead to tighter integration and an increase in the vertical scope of the extended enterprise. Our research suggest that the nature of the information technologies and of the business activities supported by an electronic market are crucial determinants of the organizational and industry changes they induce, and our results have important implications for a variety of industries in which both technological and agency issues will influence the eventual success of global IT-facilitated extended enterprise initiatives. 0 We thank

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Section: Modelmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Electronic Markets, Search Costs and Firm Boundaries

Shankar

Sundararajan

2005

SSRN Journal

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“…In terms of value to market participants, e-marketplaces may offer a variety of services including matching buyers and sellers to identify and satisfy their needs (Ranganathan, 2003;Rao et al, 2007;Molla and Deng, 2009), aggregating information on goods and services, and providing assurance of trust and integrity for buyers and sellers (Bailey and Bakos, 1997;O'Reilly and Finnegan, 2009;Soh et al, 2006). Others include logistics and payment services (Singh et al, 2013).…”

Section: E-business Modellingmentioning

confidence: 99%

Formation and Failure of an E‐Marketplace Pioneer in a Developing Country

Effah

2014

E J Info Sys Dev Countries

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The purpose of this study is to understand the formation and failure of an e-marketplace pioneer in a developing country. Much of the research on e-marketplaces focuses on the developed world. Within the limited literature on the developing world, the dominant focus has been on user adoption and related constraints. Little research thus exists on how emarketplaces are formed and whether they succeed or fail. This study therefore follows qualitative interpretive case study methodology to investigate the formation and failure of an e-marketplace pioneer in a developing country. The findings show that the e-marketplace was formed without a clear e-business model and without enough attention to the developing country environment. The failure was subsequently caused by inability to generate revenue and failure to renew domain name license. The paper advises potential entrepreneurs to pay attention to their local environment and develop e-business models with appropriate revenue options to guide their e-marketplace initiatives.KEYWORDS: e-business, e-business model, e-marketplace, interpretive case study, developing country, Ghana INTRODUCTIONThe purpose of this study is to understand the formation and failure of an e-marketplace pioneer in a developing country. Continuing growth of the Internet and related Web technologies offers entrepreneurial opportunities for advanced e-business models such as emarketplaces (Truong and Bhuiyan, 2011). E-marketplace generally refers to an electronic platform that enables multiple buyers and sellers to exchange information about products and services and engage in economic transactions (Molla and Deng, 2009;O'Reilly and Finnegan, 2009). Since the dot-com era from the late 1990s to the early 2000s, e-marketplace has attracted much research attention in the e-business literature (see Standing et al., 2010;Wang et al., 2008). However, the bulk of this attention has been on the developed world.Relatively little empirical research therefore exists on e-marketplaces from the developing world (e.g. Pare, 2003;Pucihar and Podlogar, 2006;Humphrey et al., 2003). Within the limited developing country literature, the dominant focus has been on adoption and use by buyers and sellers and the challenges involved. As a result, not much empirical research exists on how e-marketplaces are formed and whether they succeed or fail. Researching e-marketplace formation and outcome is important because the findings can help researchers to understand the developmental phase of the technology before its adoption and use. Moreover, the findings can offer rich insight to potential entrepreneurs on how to found e-marketplace innovation in developing countty context while avoiding failure.This study therefore investigates the formation and failure of E-GhanaMarket (pseudonym), a pioneer e-marketplace start-up in the developing country context of Ghana. The research question motivating the study concerns how e-marketplaces in developing countries get formed and why they may fail. To address the research ...

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“…Hence, the seller should apply various functions and services in order to generate trust: for example, reputation mechanisms, matching services, personalization options, authentication features, quality assurance, payment processing, and secure communications (Bailey & Bakos, 1997;Bakos, 1998;Coles & Smart, 2011;Sarkar et al, 1998;Verhagen et al, 2005).…”

Section: Building Confidence (Trust)mentioning

confidence: 99%

Analysis of the State of E-commerce in Algeria

Chaabna

2015

IJMS

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This paper focuses on investigating and analysing the state of e-commerce in Algeria, determining the nature of the barriers that are preventing the country from taking off as expected and proposing some solutions based on Porter's diamond model of national competitive advantage. This incorporates cross-industry institutions and networks as key determinants of national competitive advantage. Following Porter's model, Algeria has made progress in building the technical infrastructure for e-commerce, but it still suffers from a lack of a comprehensive regulatory framework and poorly developed supporting institutions and social networks. While e-commerce in Algeria is still in its initial stages compared to other developing countries, there is great potential for rapid and sustainable growth in the coming years.

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An Exploratory Study of the Emerging Role of Electronic Intermediaries

Cited by 483 publications

References 10 publications

Electronic Markets, Search Costs and Firm Boundaries

Electronic Markets, Search Costs and Firm Boundaries

Formation and Failure of an E‐Marketplace Pioneer in a Developing Country

Analysis of the State of E-commerce in Algeria

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