A System Dynamics Analysis of Electronic Commerce

In this paper an attempt is made to understand contribution factors in the field of electronic commerce(EC). To do that, we adopt and modify an existing model. Then money sector is added to the model for capturing whole EC process. Also, perception and capacity expansion delay are reduced step by step to find out important factors of EC. The following two major conclusions are drawn from our simulation. Most of all, the diminution of information delay introduce monotonous growth rather than fluctuation of EC market. The stable increase of revenue or market scale makes us decide the employment or capacity scale quickly. This is critically helpful for success of EC. Second, for favorable and continuous evolution of EC, utilization system of electronic money should be established steadily. The following findings strongly support our claim: We found full oscillation of EC market when electronic money system didn't established well. On the contrary, if electronic money system could provide fast cash flow and fully trustful function, decisions of company or consumer would be executed promptly.