E-commerce has been a widely used mean to purchase goods and services all over the world. This study investigates the role of cultural differences and information technology infrastructure on usage of e-commerce in developed and developing countries. As shown in Genis-Gruber and Tas (2007) cultural differences are expected to play a major role on e-commerce behavior especially in developing economies. In order to identify cultural differences, we use Hofstede's classification. We classify the countries according to these indices and their technological and economic development. We make several cultural comparisons among various countries and we empirically investigate whether these cultural differences play a significant role on e-commerce behavior. We implement OLS and fixed effect regression methods. Using dummy variables and interaction variables, we estimate the effect of cultural differences on e-commerce purchases and other e-commerce variables. Besides the effects of cultural factors, we also investigate the effects of information infrastructure and education level of the countries. We conclude that cultural dimensions play an incremental role on e-commerce and relationship between infrastructure and e-commerce. We control for several other factors like information infrastructure and education level, and use different econometric techniques to achieve our results.
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