Examining Inefficiencies and Consumer Uncertainty in E-Commerce

The popularity of e-commerce can be attributed to open (and mostly unbridled) competition with minimal barriers to entry. Yet, recent surveys suggest a general lack of consumer confidence in transacting online. Such findings are troubling — pointing to probable inefficiencies in e-commerce. The question then is: what are these inefficiencies and how do they prompt such consumer uncertainty? In answering the question, this paper surfaces three core e-commerce inefficiencies: seller anonymity, lack of product transparency, and lack of process transparency. It is also contended that consumer uncertainty is not an intrinsic buyer characteristic. Rather, it is contingent upon the information specificity of specific products that consumers transact in B2C and C2C e-commerce. Tying together threads from behavioral economics, this paper offers a novel perspective toward understanding electronic market inefficiencies and its consequent effects on consumer uncertainty. Apart from proposing a model of consumer uncertainty in e-commerce, the study offers a preliminary empirical validation of the proposed model. Findings suggest that inherent Ecommerce inefficiencies of anonymity and lack of product and process transparencies cause consumer uncertainty. The findings further evidence how buyer uncertainty increases when planning to buy products with high information specificity, especially when product transparency is lacking

Antecedents and contingencies affecting uncertainty in electronic markets: an empirical study

The rise of E-commerce came with the promise of disintermediation. However, the e-commerce scenario today is flooded by an increasing number of intermediaries, e.g. Amazon, Verisign and Thawte. Economics of intermediation suggests that intermediaries arise when consumers are unsure of the market in general. The question then is: what market conditions prompt such consumer perceptions of uncertainty? This paper tries to address this very issue by empirically testing antecedent and contingent conditions to consumer uncertainty in electronic markets.Findings suggest that consumer uncertainty is traceable to inherent electronic market inefficiences of anonymity and lack of product and process transparencies. The findings also suggest that uncertainty is a function of product price, but only when product tranparency is lacking. However, the study did not find any significant influence of gender on consumer uncertainty, as previously theorized

The economics and psychology of consumer trust in intermediaries in electronic markets: The EM-Trust Framework

The rise of electronic markets (EM) and e-commerce came with the promise of disintermediation. Yet, from aggregators to authenticators, the online landscape today is scattered with intermediaries such as EBay and Verisign, aiming to streamline e-commerce transactions and building consumer trust in EM. The central theme of this paper is to understand the contextual factors that lead to consumers need to trust intermediaries. In developing our arguments, the paper synthesizes perspectives from information economics, transaction cost economics, and literature on institution-based trust to develop the EM-Trust Framework. Drawing from information economics, the paper contends that EM embody certain inefficiencies, which in turn contribute towards heightening consumer uncertainty, especially under conditions of high information specificity. Heightened consumer uncertainty subsequently reduces consumer trust in EM. It is only in the face of uncertainty and a loss of trust in EM that consumers transfer their need to trust in intermediaries. However, the transference of trust is complete only if agency costs from intermediation lie within consumer thresholds. A mini-case of online mortgage marketplaces is used to illustrate the EM-Trust Framework, thus creating threads for more insightful investigations in the future. © 2008 Operational Research Society Ltd. All rights reserved

Online consumer market inefficiencies and intermediation

This paper seeks to empirically unravel why consumers sometimes need to trust intermediaries in online markets. Notwithstanding assertions that online markets will eventually eliminate the need for intermediaries, intermediaries remain an active part of the online market landscape. This paper tries to understand this phenomenon from a view of a consumer lack of trust in online markets and seeks to unearth what ultimately causes a lack of consumer trust in online markets and the role played by intermediaries in the mix. The paper proposes a model and empirically validates it. Findings suggest that inherent inefficiencies in online markets lead to consumer uncertainty. Perceptions of uncertainty lead to a lack of consumer trust in online markets. Consumer trust in online markets is restored only by placing trust in intermediaries

Statistical Analyses of Next Generation Sequence Data: A Partial Overview

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