Java for the Web — Economic Implications

Abstract

According to many recent analyses all types of electronic commerce³ (e-commerce or EC) over the Internet will dramatically gain importance in the next few years (see e.g. Henry et al. 1998). It is a well-known fact, however, that this development is only realistic if the infrastructure of the net can cope with the sharply increasing demand. The legal and security issues arising with e-commerce have to be solved, and cheap and secure payment systems have to be developed. In numerous articles, economists address these and related topics.⁴ Nevertheless, most economists do not explicitly take into account that proper software is needed, too. Indeed, the literature about the “economics of software” as a whole is relatively rare. This is a surprising fact: the software industry is, e.g., a leading sector in the U.S. economy and it is growing rapidly. “From 1984 to 1993, employment in the [U.S.] computer and data processing industry grew at a hefty 7 percent annual rate, well above the one and three-fourths percent growth in total nonagricultural employment over this period” (Sichel 1997, pp. 51–52).

Java is an object-oriented and platform-independent programming language, designed by Sun Microsystems.

The author is grateful to Anja Bunte, Winfried Reiss, and Wolfgang Rothfritz for valuable comments.