New Mechanism Design in the C2c Online Reputation Evaluation Optimizing

Abstract

In view of the assumption of the trader's bounded rationality, our research analyzed the defects of current reputation evaluation mechanism and the trust problem in the online trade. The mechanism was redesigned from the three aspects of the evaluation process, the accounting method of the reputation-limit and reputation rating scores, then, the system of "tell the truth" has been added to the mechanism to realize the improvement of incentive function in evaluation mechanism. In order to prove the effectiveness of the new mechanism, an algorithm example was given based on the sequential game analysis and Harsanyi transformation of the bounded rationality trader's decision-making. The results show that the new mechanism can effectively provide the decision-making information for the trading parties in the process of reputation evaluation, and encourage both parties of evaluation to select the "tell the truth" strategy achieving the maximum reputation score.