E-Commerce Takes Off

WHY IS THIS IMPORTANT? The Internet, with its enormous potential to increase efficiency and raise productivity, is a critical component of the New Economy. Internet commerce, which is arguably the most significant component of electronic commerce ("e-commerce"), includes consumer retail and business-to-business transactions; online financial services; media; infrastructure; and consumer and business Internet access services. In order to understand how the Internet will affect the New Economy, it is important to know both the Internet economy's total size and how that size is distributed.

THE TREND: () The total U.S. Internet economy more than doubled between 1996 and 1997, from $15.5 billion to $38.8 billion. By 2001, the total U.S. Internet economy is projected to be over $350 billion. Business-to-business e-commerce is expected to account for the largest share, $186 billion. Consumer retail activity is expected to emerge more slowly, possibly totaling $18.4 billion in 2001.

THE DATA:

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Productivity Paradox | Knowledge Economy
Nine Myths | Data Sources | Endnotes | The Authors

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