After the Goldrush: Deconstructing the Myths of the dot.com Market

Abstract

Many would claim that the development of electronic commerce is reshaping almost all industries, even to the extent that we are undergoing a paradigm shift. This enthusiasm represents a speculative bubble, what economists would describe as ‘mania’, as we witness increasing numbers of firms embracing the need for an on-line presence, despite the absence of both profits and sales. The recent turn of events, which is referred to as the ‘ dot.com implosion’, indicates that the rapid profit growth that was initially projected is unlikely to be achieved by many. As the technology markets have crashed along with a number of high-profile dot.com collapses, numerous investors have almost turned off from funding this sector. This should come as little surprise. What is of interest is why myriad investors were drawn into financially supporting these start-ups in the first instance. This paper aims to focus on the concept of business-to-consumer commerce and uses mythology for providing some explanation as to why so many investors were lured into participating in the dot.com share bubble.