Theoretical model for the higher-level analysis

In this thesis, the overall structure of the data analysis chapters (Chapter 5-9) and the structure of the last data analysis chapter (Chapter 9) on overall WTO effects are based on the theoretical model for the higher-level analysis (see Figure 4.5).

The theoretical model for the higher-level analysis is built from the initial conceptual framework on e-commerce adoption/diffusion factors at the societal level and effects of WTO commitments (Table 2.7, Chapter 2, pp.31-36) developed from the literature review in Chapter 2, but displayed graphically in the form of a causal network (Miles and Huberman, 1994). The things in boxes are elements of the theory; and the arrows indicate direction of causal influence.

This model posits that some components of WTO agreements can affect e-commerce diffusion by influencing the intermediary environmental factors for e-commerce diffusion. Identified by the literature review, these components of WTO agreements include the ITA, the GATS, the TRIPS, and the Ministerial declarations. The environmental factors essential for e-commerce diffusion cover five major issues – information infrastructure, commercial services, trust, regulatory and legal framework, socio-cultural factors – and sub-factors under each of these issues. The components of WTO agreements are supposed to make certain e-commerce environmental factors change to a more hospitable status for e-commerce adoption, thus facilitating overall e-commerce diffusion. In process theory and realist terms, the model posits that these components of WTO agreements have causal powers to change the environmental factors; and an individual environmental factor is only a necessary condition for e-commerce diffusion to occur. Thus, there are many other contextual conditions – factors not related to the WTO agreements – that may influence the outcomes. So, the model does not assume an invariant relationship between WTO accession and e-commerce diffusion.

Perry (1998) indicates that prior theory developed from the literature can be the first step in the theory-building process of case study research. Some prior theory can

have a pivotal function in the design of the case study and analysis of its data. Pure induction might prevent the researcher from benefiting from existing theory, just as pure deduction might prevent the development of new and useful theory (Perry et al., 1999). Thus Parke (1993, p.252; p.256) argues that “both extremes are untenable and unnecessary” and that the process of ongoing theory advancement requires “continuous interplay” between the two.

Walsham (1995) also suggests that the motivation for the use of theory in the earlier stages of interpretive case studies is to create an initial theoretical framework which takes account of previous knowledge, and which creates a sensible theoretical basis to inform the topics and approach of the early empirical work.

Although theory can provide a valuable initial guide as described above, there is a danger of the researcher only seeing what the theory suggests, and thus using the theory in a rigid way which stifles potential new issues and avenues of exploration. It is desirable in interpretive studies to preserve a considerable degree of openness to the field data, and a willingness to modify initial assumptions and theories. This results in an iterative process of data collection and analysis, with initial theories being expanded, revised, or abandoned altogether. A simple metaphor for this latter case is described by Walsham (1995) as the use of scaffolding in putting up a building, where the scaffolding is removed once it has served its purpose.

This advice was followed during the whole process of data collection and analysis. The open-mindedness referred to by Wolcott (1982) was achieved by including open-ended interview questions in the interview protocol. Consequently, as indicated in Figure 4.5, besides the relationships developed from literature, an additional relationship (a dashed arrow) has been developed from field data and added to the final model.

This new relationship is connected with rights to trade awarded by approval from the Chinese government. Before the WTO accession these rights were restricted to only approximately 35,000 Chinese enterprises, while prohibiting foreign companies in principle from trading (USTR, 2004a). Within three years of accession, China has committed to permit all companies in China (including foreign companies) to obtain

rights to trade. With the emergence of a truly global free market economy, a company is likely to experience competitive pressure from every corner of the globe. Gibbs, et al. (2003) argue that a country’s integration in global production networks and the extent of trade liberalization can increase the level of global competition and therefore the pressure for countries to adopt e-commerce as a means of reducing costs and/or expanding markets.

All the other components of the model depicted in Figure 4.5 have been explained in Chapter 2 when building the conceptual framework on e-commerce adoption/diffusion factors at the societal level and the effects of WTO commitments. Thus no repetition is made here. Instead, nine propositions related to this model are listed in Table 4.2. At the end of each proposition, the last column of the table indicates in which chapter the proposition will be discussed.

Table 4.2 Propositions related to the model for higher-level analysis

Proposition No. Proposition content Chapter No.

1 The WTO commitments can improve

liberalization in telecommunication services and thus help e-commerce diffusion in China’s coastal urban area.

5

2 The WTO commitments can improve

liberalization in banking services and thus help e-commerce diffusion in China’s coastal urban area.

6

3 The WTO commitments can improve

liberalization in logistics and express delivery services and thus help e-commerce diffusion in China’s coastal urban area.

7

4 Implementation of the ITA can improve liberalization of IT products importation and

8

thus help e-commerce diffusion in China’s costal urban area.

5 The WTO commitments can improve

liberalization of computer and related services and thus help e-commerce diffusion in China’s costal urban area.

8

6 The WTO commitments can improve

intellectual property rights protection and thus help e-commerce diffusion in China’s costal urban area.

8

7 The WTO commitments can improve

liberalization of educational services and thus help e-commerce diffusion in China’s costal urban area.

8

8 The WTO commitments can restrain the imposition of duties on e-commerce and thus help e-commerce diffusion in China’s costal urban area.

8

9 The WTO commitments can liberalize foreign trading rights so the desire and pressure to compete globally increase e-commerce adoption in China’s costal urban area.

8