Diffusion of e-money and industrial structure change in Japan

This paper analyzes the factors to promote the diffusion of electronic money in Japan by focusing on the interfirm networks. We found that many firms with a variety of business domains including finance, vendor, retailer, transportation, and mobile phone carrier contribute to the development of the market. This development process has three stages. The first stage is trial where contact type IC cards are used. The second is commercialization of electronic money using contactless IC cards. The third is rapid and widespread dissemination of electronic money using contactless IC cards. Different actors play a crucial role at different stages. Moreover, a hub leader firm invited a newcomer to the network in each period. These collective actions enabled the rapid dissemination of electronic money in Japan. We discuss the intention and strategy of such hub leader firms.