Book Review on Emerging Markets and E-Commerce in Developing Economies

Kamel Rouibah, Omar E. M. Khalil, and Aboul Ella Hassanien Emerging Markets and E-Commerce in Developing Economies. (IGI global, 2009). 408 pp. $175 (hardcover). ISBN: 9781605661001 .

The entire book summarizes and synthesizes all different literature on e-commerce (business conducted electronically) in developing economies from an interdisciplinary approach. Authors claim to cover all work published on the subject simply because e-commerce in the developing world is still a new field to study and that where the need emerges to write this book. This book can be categorized as an extension or a following volume of a study conducted by Nagi and Wat in 2002 that focused more on developed countries and covered literature on e-commerce published between 1993 and 1999. This book concentrates more on literature on developing countries that was published after 1999. Some chapters of this book are merely informative of what the situation is, while others state possible solutions for the problems presented or offering subjects of research for other academics. Each chapter has a different message to deliver; however they all together lead to encourage the implementation of e-commerce in developing countries and also emphasize how important and beneficial that would be for developing nations. Another goal of the book is to clarify new, available, and unfulfilled subjects of research for follow academics.
Summary
The book consists of eighteen chapters. The first chapter is mainly an introduction for the rest of the book. It summarizes and reviews much of earlier literature on e-commerce and offers a glimpse of what will be discussed in details in later chapters. Issues and challenges that face developing nations when implementing e-commerce are discussed in this chapter but only very generally because they are studied extensively in later chapters. Moreover, this chapter is unique in this book because it is the only one that does not include a case study Chapters from 2 to 5, are mainly about the current situation of developing countries regarding infrastructure for e-commerce. These countries are China, Russia, and Sri Lanka. Both China and Russia are of the largest and most researched developing countries in the world and that naturally make them easy targets for research. Additionally, the two nations have different cultures and represent two sides on many indexes that are presented in the book. However, Sri Lanka is chosen here for an entirely different reason and that would be its representation of smaller developing countries. One notable difference in this part of the book is how chapters from 2 to 4 are about large companies and e-commerce; however, chapter 5 tackles e-commerce in developing countries in terms of small and medium firms. The chapters conclude that results and challenges from e-commerce differ among countries according to the society’s culture and customs. The four chapters focused primarily on three countries.
Chapters 9 and 10 study human behavior regarding business and applying it in e-commerce models. A modified TAM (technology acceptance model on how people accept technology according to its perceived usefulness and ease of use) is used throughout the 9th chapter to research the differences between different cultural reactions to e-commerce. Algeria and Malaysia are the two countries chosen to conduct analysis on during this study. Chapter 10 goes broader in analyzing cultural differences by comparing developed and developing countries in general. Authors take Hofstede’s dimensions of culture and study their effects on e-commerce. Hofstede’s model studies how culture effects people’s reactions to new practices according to how hierarchy, society’s interrelationships (individualism vs. collectivism), gender differences, uncertainties, and long term goals are perceived within each society. Finally, the chapter is concluded with two case studies, on Turkey and MENA countries, that authors claim to be proving the accuracy of their findings. These two short case studies are the only two in the book made by authors while on all other case studies; they only analyzed the results of research made by other academics. In chapter 11, a study on the use of SMS in Kuwait’s financial services is analyzed to prove once again that using cultural models (such as Hofstede’s and theory of planned behavior) are actually applicable on e-commerce in real life.
In chapter 6, many models, such as virtual currencies (currencies that only exist online) and Web 2.0 e-commerce based models (blogs, social networks…etc.), were introduced to solve major problems that are uncovered in previous chapters. One of the problems is lack of financial infrastructure.
Chapters 7 and 8 shift the discussion from the use of technology in business represented by e-commerce to introduce the new concept of e-governance (governmental procedures conducted electronically). E-Governments are presented more as prerequisites to e-commerce in these two chapters. At first, only the concept of e-governance is introduced with the strategic example of Uganda. Afterwards, the authors explain how the implementation of technology would benefit the country as a whole. Chapter 8 compares how procedures and implications of introducing technology are different between governments and businesses. This chapter also starts showing the overlapping benefits and implementations between the two.
Afterwards, authors finally start presenting applicable models of the new economy that is based on technology. Chapters 12 to14, go in depth on how businesses should operate with these newly implemented technologies. Chapter 15 is a case study on what businesses are “going at it” in Tunisia regarding e-commerce. This chapter serves as an example for the previous three.
The last three chapters (16, 17, and 18), serve as a conclusion for the book. The cases of Egypt, China, and Serbia are being studied under the scope through three main periods. These periods are before, during, and after the implementation of e-commerce in many businesses there. Differences in challenges and solutions for the three countries are clarified in these chapters. Authors, to emphasis their own statement at the start of the book, chose three different countries from different continents with different cultures to show how these variances effect e-commerce.
Critique
The organization of chapters in the book is logical. The book starts off with an introduction of the purpose and the history of e-commerce, followed by the situation without technology and challenges during that period, which aims to clarify to its audience the importance of technology in developing economies. Afterwards, the authors began on the how to use these technologies in the best way possible. The only negative aspect of this organizational structure is the length in which authors explain the importance of technology diffusion in the new global economy. Around three quarters of the book is written on this matter in particular. It is not that this part of the book is not important; it is just much of the information through the first half of the book is not that relevant anymore. Technology is the most changing aspect of our lives; it is the largest growing sector in the global economy. With the knowledge of how rapidly growing this sector is, authors chose to spend much of the book discussing different studies from the last century. For example, in chapter 5, the issue of financial infrastructure in developing countries is reintroduced and discussed more thoroughly with the example of China. One of the main problems of financial infrastructure mentioned is lack of electronic payment methods, which is no longer true for the case of China, especially since the huge development of China UnionPay –CUP- (subsidiary of People’s Bank of China that was established in 2002). CUP is, now, the main competitor of VISA, they both provide the same services and their cards are just as useful in online payments. Authors describe Chinese online payment systems with “deficiency” (101), then again they describe people in developing countries to be “afraid of making purchases using borrowed money” (136) with “China present[ing] an excellent example”(136) as a way to explain why credit cards are not used by most Chinese people. This argument can be questioned with how CUP debit cards would not be a solution?
The authors justified their approach from the start that there is not much literature to build on for e-commerce in developing nations in the first place. On the second page, authors stated: “extant research on e-commerce has largely focused on developed countries”, then later on the same page they analyze the current state of research on e-commerce in developing economies with having a “knowledge gap” (2). For these reasons, it is not surprising that not all findings of the book are considered to be reliable. Authors stated, exactly, that the Kuwait study is very statically weak for it only presented university students at “one school in one country” (247), which is not reliable for a sample. Again, in many surveys, the response rate is too low to consider the sample representative of the population. For example, one of the studies report “a response rate of 13 percent”(94), which authors consider “acceptable rate”(94) for variety of excuses; however, to build a study on such weak basis would definitely effect the outcomes; Especially if, statistically speaking, the average response rate for e-mail questionnaire is around 40%. Furthermore, the authors even used “Wikipedia”(187) as a source for some of their information, which hardly can be considered reliable for academic facts. In the authors’ argument of how essential e-commerce is to future development of “third world” economies, they placed huge emphasis of how important the role of governments must be in order to implement these technologies. They also emphasized of how much of priority to these governments should e-commerce be. For example, the case of Uganda was displayed as a model for what many developing countries could accomplish by adopting technology in their governmental structure; however, in 2011 the country went into a nation wide famine, which is not the first of it is kind to the country, and that makes one wonder if spending the government’s limited resources on technology is the wisest. The case of Uganda is placed in the book to advocate the idea of how beneficial e-governance is even for the poorest nations in the world. Nevertheless, the 7th chapter is very limited by not taking into account all aspects of the country’s economical situation. This narrow approach is most obvious on the 7th chapter but can be found in most chapters of the book. An important positive aspect of the book is transparency and accessibility. Information in the book is presented as clearly as possible with examples, case studies, tables, and graphs. The use of visual aid is very useful and apparent throughout the book. Research methods, procedures, numbers, and calculations are very accessible for readers who are looking for that kind of data. The only problem with including numbers in the paper can be noticed in chapter 11, which is the weakest link in the book, where no tables or indexes were used in pages 243 to 246, the writing is very confusing and information accessibility is much more difficult than it is in all other chapters. Another problem one can notice while reading the book is the repetition of some information between chapters. Major issues are being reintroduced in every other chapter but only with different words and with some more information is added to it; such issues are individualism, financial infrastructure, and the governmental rule in e-commerce.
In conclusion, this book is very ambitious; however, there is a facts overload that the authors helped allowing by not refining the information better. For example, “virtual Q coins” (137) is presented as a model for developing countries to have as an alternative for traditional electronic payments but the example is provided with outdated facts on China. Chapters 7, 8, 12, 13, and 14 are the most informative and concise chapters of the book even with the problematic issues regarding the case studies, such as the one on Uganda; however, the models and guidelines presented are very useful for readers who are interested more in applying e-commerce in developing countries.

Northeastern University