Journal of Financial Services Research

, Volume 22, Issue 1, pp 73–90

Impacts of e-Commerce and Enhanced Information Endowments on Financial Services: A Quantitative Analysis of Transparency, Differential Pricing, and Disintermediation


    • The Wharton SchoolUniversity of Pennsylvania
  • Lorin M. Hitt
    • The Wharton SchoolUniversity of Pennsylvania
  • Bin Gu
    • The Wharton SchoolUniversity of Pennsylvania
  • Matt E. Thatcher
    • University of Arizona
  • Bruce W. Weber
    • Baruch CollegeCity University of New York
    • Boston College

DOI: 10.1023/A:1016087915007

Cite this article as:
Clemons, E.K., Hitt, L.M., Gu, B. et al. Journal of Financial Services Research (2002) 22: 73. doi:10.1023/A:1016087915007


Some implications of e-Commerce financial services firms are becoming clear. The web drives transparency, and increases the information endowment of all market participants. It is harder to manipulate customers' behavior, or to overcharge them. Transparency drives differential pricing. Not all customers can or should be charged the same prices. Transparency reduces the viability of cross-subsidies between customers can or between products. The differential pricing enabled by the web transforms distribution channels, and enables direct distribution and alternative forms of distribution. Some intermediateraries may be bypassed altogether, while others may rapidly lose their best, most profitable, and previously most loyal customers.

Net-based financial servicestransparencypricingbypass and disintermediation.

Copyright information

© Kluwer Academic Publishers 2002