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Determining factors for the adoption of e-business: the case of SMEs in Korea


  • Bang Nam Jeon
  • Kyeong Seok Han
  • Myung Jin Lee


This study investigates the determining factors of the successful adoption of e-business by small and medium enterprises (SMEs) in Korea using survey data. After the major determining factors were identified from the innovation adoption literature and were extracted by applying the principal component analysis to the survey data and by adding the country-specific characteristics of Korea, we conducted empirical analyses to determine the critical success factors for the adoption of e-business by Korean firms. The empirical results which are based on t-tests of the differences between adopters and non-adopters, the linear probability model, and the logit model, all suggest that the important determinants of the successful adoption of e-business by SMEs in Korea are: the CEO's knowledge of information technology (IT)/e-business, relative advantages and benefits from implementing e-business, governmental support, globalization strategy and the North Korean factor. Business size, the cost of e-business adoption and competitive pressure of the industry do not seem to play an important role in the adoption of e-business by Korean SMEs. The policy implications of this study on promoting e-business adoption by SMEs in emerging economies, such as Korea, are also discussed.

Suggested Citation

  • Bang Nam Jeon & Kyeong Seok Han & Myung Jin Lee, 2006. "Determining factors for the adoption of e-business: the case of SMEs in Korea," Applied Economics, Taylor & Francis Journals, vol. 38(16), pages 1905-1916.
  • Handle: RePEc:taf:applec:v:38:y:2006:i:16:p:1905-1916
    DOI: 10.1080/00036840500427262

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    1. repec:spr:grdene:v:18:y:2009:i:5:d:10.1007_s10726-008-9136-8 is not listed on IDEAS
    2. Tiago Oliveira & Maria Fraga O. Martins, 2011. "Understanding the determinant factors of Internet business solutions adoption: the case of Portuguese firms," Applied Economics Letters, Taylor & Francis Journals, vol. 18(18), pages 1769-1775, December.
    3. Sheng-Fang Chou & Jeou-Shyan Horng & Chih-Hsing Liu & Yung-Chuan Huang & Yu-Chun Chung, 2016. "Expert Concepts of Sustainable Service Innovation in Restaurants in Taiwan," Sustainability, MDPI, Open Access Journal, vol. 8(8), pages 1-19, August.
    4. Kurnia, Sherah & Choudrie, Jyoti & Mahbubur, Rahim Md & Alzougool, Basil, 2015. "E-commerce technology adoption: A Malaysian grocery SME retail sector study," Journal of Business Research, Elsevier, vol. 68(9), pages 1906-1918.

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