Adoption of the Internet and the Information Superhighway for Electronic Commerce

The Internet has made a major impact on electronic commerce and market structures by facilitating information exchange between organizations. For researchers and business professionals, the economic and social ramifications of the Internet have generated much interest. Inspired by the many studies done on the information technology (IT) adoption, particularly Everett Roger’s research in diffusion of innovation, we develop an Internet adoption model using economic theories such as asset specificity, installed base effect, network externality, and transaction cost theory. This paper will show that the adoption of the Internet for electronic commerce involves several issues. The model can serve as a guideline for evaluating an organization’s readiness to adopt the Internet.