Contents of Volume 47

Volume Contents

Contents of Volume 47     

Market Model-Based Channel Selection in B2B E-Commerce: Exploring a Buyer's Adoption Decisions

Companies that seek to exploit the cost advantages of business-to-business (B2B) e-Commerce face a variety of strategic options. By analyzing the demand and cost functions for sellers, intermediaries, and buyers, this research develops an economic framework that clarifies the relative advantages of four common B2B e-Commerce channels: private exchange, web-based procurement, public aggregation, and public exchange. This research focuses on addressing two important questions: (1) How does a buyer select a suitable B2B e-Commerce channel (or an e-Marketplace structure) given a variety of market conditions, different levels of product substitution, and a range of purchasing patterns? (2) How does a buyer successfully manage a B2B e-Commerce channel for gaining the highest transaction-level buyer surplus? The analytic and numeric results of our study show that a company's product offerings, the market conditions it faces, and the purchase patterns it implements are all important determinants in the selection of B2B e-Commerce setting. For custom products, private networks (such as the private exchange or web-based procurement models) are more attractive than the public aggregation or exchange models. However, taking market conditions and purchasing behavior into consideration, the web-based procurement model is more suitable for spot purchasing, while the public exchange model is more suitable for systematic purchasing and fragmented markets. On the other hand, the aggregation model is preferable in concentrated markets while the exchange model is more suitable in fragmented markets. These results provide important implications for industrial development of B2B e-Commerce.     

Pricing, price dispersion, and information: The discount brokerage industry

The paper provides an empirical analysis of the pricing behavior of firms within the discount brokerage industry, with emphasis on testing the role of costly information in affecting prices. Several empirical tests are performed that indicate that prices in this industry respond in ways hypothesized by theoretical models of markets operating under conditions of imperfect information. The industry is characterized by a wide degree of price dispersion that does not appear to simply reflect quality differences among firms. In addition, the variance of prices across geographic markets is associated with variables that theoretically should affect the levels of consumer information in those markets.