Institutional Environment for Business-to-Business (B2B) E-Commerce Usage: Toward an Understanding in the Chinese Context

Abstract

This study leveraged new institutional economics (NIE) theory to examine whether and how four facets of the institutional environment—industrial pressure, governmental support, legal adequacy, and national culture compatibility—affect business-to-business (B2B) e-commerce usage. Due to a lack of overarching research models and empirical evidence, several research steps leading to interview data were taken to address the research question: 1) a comprehensive literature review on NIE theory and the four institutional factors; 2) a pilot study surveying 11 firms in China using short, structured questionnaires; and 3) focused phone interviews with three Chinese firms using non-directive, open-response questions based on the pilot study results. Then a pattern-matching, literal replication approach was followed to conduct a cross-case analysis. Results suggested that industry pressure from customer usage and requests was an important driver of B2B e-commerce usage in those Chinese firms. A supportive government policy and regulatory environment may facilitate contractual trust in the e-commerce context. Also, Chinese culture that values face-to-face interaction and interpersonal relationship deterred e-commerce usage in those firms. These results led to proposal of a conceptual framework and four propositions for future institutional studies on B2B e-commerce usage. The theoretical and conceptual views through the lens of NIE theory and interviews with business executives provide unique insights of B2B e-commerce usage for researchers, managers, and policy-makers.