The international environment is the most important factor that drives the diffusion of B2B e-commerce in Taiwan. 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 the 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.
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