-----------------SUMMARY-------------------------
International environment is the most important factor that drives the diffusion of B2B
e-commerce in Taiwan, where the digital information network that enables supply-chain
management is used by Taiwanese firms as a means to protect their position in global production.
National environment elements, such as telecommunication infrastructures and human resources,
are useful reinforcing factors, but not powerful enough to drive the whole process. Government
policies play a role only to the extent that they encourage a certain approach to e-commerce
solutions. In the case of B2C e-commerce, Internet penetration among the general population is a
precondition for diffusion. On-line security concerning trading and payment is critical for the
acceptance of electronic commerce by Internet users and national environment is crucial in this
regard. Nevertheless, the most effective driver for the diffusion of electronic trade appears to be
innovation of the right products. Without such products, the diffusion of e-commerce will be
limited, even with the right environment and policies.

*Center for Research on Information Technology and Organizations
University of California, Irvine