Dilemmas in addressing policy issues in electronic commerce


Nancy Pouloudi and Natasha Papazafeiropoulou
Department of Information Systems and Computing
Brunel University


Policy makers have recognized the viability of electronic commerce and the opportunities it offers for business and citizens. While several ethical and security issues arise from the use of the new technologies there is a general consensus that the benefits are substantial and justify the investment in electronic commerce. There are several efforts in this direction by policy makers at a national and international level. This paper will argue that technology alone is not sufficient for the successful implementation of complex electronic commerce strategies but the examination of social and political issues is crucial for a holistic approach on the subject. Indeed there are several dilemmas related to policy issues, making the role of the policy makers critical. The paper will concentrate on two of the most frequently discussed social issues in electronic commerce. These are trust, a social issue underlying the business use of the Internet, and digital democracy, a term underlying the use of Internet technology in the society as a whole. The paper will consider a general framework for policy making that could be used at a national or international level as a starting point for considering social issues in the context of electronic commerce strategies.

Central to our discussion are the dilemmas that policy makers have to address. Previous research has argued that the policy objective of promoting deregulation and competition is in conflict with other policy priorities, in particular the desire to provide open networks and open access and the aspiration to provide universal service to citizens (Graham, 1995). As electronic commerce expands, the dilemmas for the stakeholders of the information society increase. The review of policy issues at different levels in the previous section has revealed some of these dilemmas:

  • Should governments give priority to national competitiveness or to international compliance? Should they promote their own
  • Is governance about protection or restriction? (For example, at an individual level: is censorship desirable? at a business level: is taxation desirable?)
  • Where should priority be given: to the protection of personal data or to competitiveness (to the extent that the free exchange of information and personal data supports electronic transactions and business practices)?
  • Should electronic commerce be promoted where the cultural and social implications have not thought through?
  • What is more important, data and intellectual property protection or the free exchange of ideas and data?

These dilemmas relate to the appropriate use of regulation, although in some cases policy makers may have little choice as only some options are realistic (e.g., the Internet is used even though the legal context is unstable). Thus, one important observation is that some dilemmas may no longer be a matter of choice, particularly for less powerful stakeholders, such as individuals, or governments of developing countries. A further observation is that in many cases these dilemmas imply a conflict between the commercial and social interests of various stakeholder groups. However, it is very difficult to draw some general conclusions about when either interest is at stake. Research in management (e.g., Pettigrew, 1985) and information systems (e.g., Walsham, 1993) as well as in law studies (e.g., as evident in the importance of case law) has stressed the importance of context. However, in ‘cyberspace’ the context, whether temporal or spatial, is elusive, making policy making for electronic commerce more challenging.

Implications for policy makers and future research directions
The challenge that policy makers face today in order to implement an efficient electronic commerce policy while addressing the dilemmas outlined above is twofold. Firstly, they need to provide the business community with a robust technical infrastructure and an efficient legislation framework. Secondly, they need to accommodate the social concerns rising from the use of electronic commerce, in order to create a ‘digital literate’ society that will fully exploit the technology at hand while preserving their social interests and cultural identities.

Further research in the area may include the investigation of electronic commerce policies implemented in different national settings and social environments since in practice different countries have different priorities. The case of developing countries would be of particular interest as technical infrastructure and stakeholder awareness and involvement can be substantially different. Research also needs to be continued in specific areas that are affected by the extensive use of electronic commerce. Because of their social importance, of particular interest are the areas of health and education where issues of Internet use and electronic commerce become increasingly relevant (e.g., through telehealth or distance learning applications). A study of alternative national policies in these areas can lead to an informative debate about the underlying assumptions concerning the duties and social responsibility of policy makers towards different stakeholder groups.


Graham, A. (1995). Public policy and the information superhighway: the scope for strategic intervention, co-ordination and top-slicing. In R. Collins & J. Purnell (Eds.), Managing the information society (pp. 30-44). London: Institute for public policy research

Pettigrew, A. M. (1985). Contextualist research and the study of organisational change processes. In E. Mumford, R. Hirschheim, G. Fitzgerald, & T. Wood-Harper (Eds.), Research Methods in Information Systems (pp. 53-78). Amsterdam: Elsevier Science Publishers, North-Holland.

Walsham, G. (1993). Interpreting Information Systems in Organizations. Chichester: Wiley.