Growing the EU’s online economy

European Commission.11/01/2012. Proposals to encourage more online commerce would make it easier to shop on the Internet across the EU – contributing to economic growth and job creation.

Electronic commerce offers many potential benefits for consumers and businesses: lower prices, increased access to goods, development of innovative services and creation of new jobs.

Online purchases account for about 3% of all retail business in the EU, but many barriers remain to the further development of a seamless Internet marketplace across its 27 member countries.

For example, the rules governing online sales are often ignored or unclear, sites do not provide enough information for consumers, and it can be difficult to compare prices.

Such problems can turn consumers away from shopping online, despite the potential savings (currently estimated at around €11.7bn annually for purchases of goods). More people could benefit if there were a safer, more open Internet marketplace.

The Commission is proposing 16 measures  aiming to double online retail sales by 2015 by providing better protection for consumers, more information and a wider range of choices.

The new proposals would:

make it easier to buy products and services online (including music and films)

ensure more efficient, affordable delivery of products across Europe

require online sellers to provide more information about their products and prices

help develop high-speed Internet services and better communications infrastructure, so more people enjoy access, especially in rural and remote areas

provide consumers with better information and protection against abuses on the Internet.

Businesses would also benefit from the measures, encouraging them to invest in online sales and services. For example, the proposals aim to prevent illegal downloading of copyrighted content (such as films and music) and establish a clear legal framework for doing business online.

The proposals complement the EU’s electronic commerce law, which sets out common rules for cross-border online sales.

Growing the EU’s online economy

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Digital Divide: From Computer Access to Online Activities–A Micro Data Analysis

This study addresses issues of digital divide among households and individuals by using micro-data analysis of ICT usage patterns.  The analysis includes data from  18 European countries (2008), Korea (2008)  and Canada (2007). Inequalities in computer and Internet use are analysed in a two-step approach. First, the paper tries to better quantify and understand the factors that separate the ‘haves’ and the ‘have-nots’. Second, it tries to explain observed differences in the frequency and type of Internet use as a result of the socio-economic characteristics of households and individuals.

The study applies logistic regression and multi-linear regression models to measure the influence of one variable while controlling for the other variables. In particular, age, gender, educational attainment, employment situation, geographical location, household income and composition are used to explain the observed differences in computer and Internet access and use (first part) and Internet frequency of use, selected Internet activities, and Internet scope of use (second part).

The study proves the feasibility of performing micro data analysis of surveys of ICT usage in  households and by individuals. It shows that:

Low income is the single most important factor for non access to a computer and to the Internet. On average, the odds that a high-income household in Europe has access to a computer and to the  Internet are over 4 times higher than for a low-income household.

The presence of children is the second most important factor for the access to a computer and to  the Internet: on average, the odds for a household with one or more children in Europe are up to 3.9 times higher than for a household without children.

Living in a town in Europe increases the odds to have access to a computer and to the Internet by  over 30% as compared to living in the countryside.

Age and economic inactivity are by far the most important factors for having never used a  computer or the Internet. The odds are over 4 times higher for European inhabitants aged 65-74 years and up to 2.6 times for those out of the labour force. (Low) income, gender (female) and (lack of) children do play a role but their effect is smaller.

Becoming unemployed is the most important factor for stopping using the Internet. The odds that a European inhabitant has not used the Internet over the last 3 months are about 2 times higher if he is unemployed or out of the labour force.

Education is the most important  determinant of the intensity of Internet use. The odds that an individual uses the Internet everyday increases by 2.4 times in Europe and by 3.6 times in Korea if he has a university degree and above.

Being a student is the second most important determinant of the intensity of Internet use – the odds that a student uses the Internet every day are 2 times higher both in Europe and in Korea.

The third factor explaining the intensity of Internet use is income in Europe (the  odds are  over 70% higher for the high-income households) and broadband access in Korea (the odds are  2 times higher for households with a broadband connection).

Young age and higher education are the main determinants for the scope of Internet use in Canada, Europe and Korea.

Montagnier, P. and A. Wirthmann (2011), “Digital Divide: From Computer Access to Online Activities – A Micro Data Analysis”, OECD Digital Economy Papers, No. 189, OECD Publishing.OECD Digital Economy Papers.No. 189

Digital Divide: From Computer Access to Online Activities – A Micro Data Analysis

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