Reputation in Online Auctions: The Market for Trust

Brown, Jennifer E.; Morgan, John

doi:10.2307/41166371

Cited by 97 publications

(58 citation statements)

References 7 publications

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“…Here the reputation mechanism to enhance trustfulness looks like that used by virtual marketplaces in online shopping (see e.g. Resnick et al, 2000;Brown and Morgan, 2006;Saeedi et al, 2015). Lastly, in today's competitive EDM event market cooperation is an increasingly valid strategy for business growth.…”

Section: Resultsmentioning

confidence: 99%

“…Later, this institutional system of using family ties was replaced by legal systems as institutions. Today trust formation and the resulting reputation of trustfulness play a major role in reducing transaction costs of internet transactions (Resnick et al, 2000;Brown & Morgan, 2006;Saeedi et al, 2015). In this article we focus on how trust is institutionalised in the relationship between partner event agencies in the Dance industry.…”

Section: Introductionmentioning

confidence: 99%

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Trust as Governance Tool in Hybrid Organizations: A Case Study for the Dance Industry in the Netherlands

Butter¹,

Joustra²

2015

IJBM

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The organization of Electronic Dance Music (EDM) events requires much flexibility, due to the need to be able to quickly respond to new market trends. It induces high specificity in organizing these events. Our case study for the Netherlands, which is the world's market leader in hosting these events, shows that hybrid forms of cooperation between producers facilitate this flexibility and adaptability. From the perspective of transaction cost economics this article focuses on the role of trust as governance tool of hybrid organizations. Trust between the collaborating event agencies has a reciprocal effect on perception of risk, therefore decreasing the need for comprehensive contractual governance or hierarchical control. We show that different types of trust can be sufficient as governance mechanism. The EDM event industry is a community-like creative sector in which calculative drivers such as repeated interaction and the importance of behavioural reputation add to trustworthiness between partners. In addition, social drivers such as a shared artistic vision lead to incentives to behave according to ex ante agreements in the design and creation of new, ground-breaking music sensations. From that perspective, we identify the factors that enhance the development of trustworthiness between partners in a hybrid organization.

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Section: Resultsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Trust as Governance Tool in Hybrid Organizations: A Case Study for the Dance Industry in the Netherlands

Butter¹,

Joustra²

2015

IJBM

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“…Brown and Morgan (2006) show that users on eBay artificially boost their reputations by selling items for very low prices in exchange for positive feedback from the buyer. Such blatant manipulation of reputation information can decrease user trust and credibility for these indicators.…”

Section: Sale Time and Seller Uncertaintymentioning

confidence: 99%

Internet Exchanges for Used Goods: An Empirical Analysis of Trade Patterns and Adverse Selection

Ghose¹

2009

MIS Quarterly

151

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The past few years have witnessed the increasing ubiquity of user-generated content on seller reputation and product condition in Internet based used-good markets. Recent theoretical models of trading and sorting in used-good markets provide testable predictions to use to examine the presence of adverse selection and trade patterns in such dynamic markets. A key aspect of such empirical analyses is to distinguish between product-level uncertainty and seller-level uncertainty, an aspect the extant literature has largely ignored. Based on a unique, 5-month panel dataset of user-generated content on used good quality and seller reputation feedback collected from Amazon, this paper examines trade patterns in online used-good markets across four product categories (PDAs, digital cameras, audio players, and laptops). Drawing on two different empirical tests and using content analysis to mine the textual feedback of seller reputations, the paper provides evidence that adverse selection continues to exist in online markets. First, it is shown that after controlling for price and other product and seller-related factors, higher quality goods take a longer time to sell compared to lower quality goods. Second, this result also holds when the relationship between sellers' reputation scores and time to sell is examined. Third, it is shown that price declines are larger for more unreliable products, and that products with higher levels of intrinsic unreliability exhibit a more negative relationship between price decline and volume of used good trade. Together, our findings suggest that despite the presence of signaling mechanisms such as reputation feedback and product condition disclosures, the information asymmetry problem between buyers and sellers persists in online markets due to both productbased and seller-based information uncertainty. No consistent evidence of substitution or complementarity effects between product-based and seller-level uncertainty are found. Implications for research and practice are discussed.

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“…Seller's reputation is defined as the fame or popularity evaluated in the form of feedback ratings by buyers. Many previous studies have examined reputation systems or feedback mechanisms in C2C e-commerce [2], [9], [13], [32], [48]. Online feedback mechanism plays an important role in the successful diffusion of C2C e-commerce [13].…”

Section: Research Modelmentioning

confidence: 99%

Roles of the Buyer´s Trust in Seller in Posted-Price Model of Consumer to Consumer E-Commerce

Joo

2015

J. theor. appl. electron. commer. res.

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Reputation in Online Auctions: The Market for Trust

Cited by 97 publications

References 7 publications

Trust as Governance Tool in Hybrid Organizations: A Case Study for the Dance Industry in the Netherlands

Trust as Governance Tool in Hybrid Organizations: A Case Study for the Dance Industry in the Netherlands

Internet Exchanges for Used Goods: An Empirical Analysis of Trade Patterns and Adverse Selection

Roles of the Buyer´s Trust in Seller in Posted-Price Model of Consumer to Consumer E-Commerce

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