Güth, Werner and Mengel, Friederike and Ockenfels, Axel (2007) An Evolutionary Analysis of Buyer Insurance and Seller Reputation in Online Markets. Theory and Decision, 63 (3). pp. 265-282. DOI https://doi.org/10.1007/s11238-007-9035-5
Güth, Werner and Mengel, Friederike and Ockenfels, Axel (2007) An Evolutionary Analysis of Buyer Insurance and Seller Reputation in Online Markets. Theory and Decision, 63 (3). pp. 265-282. DOI https://doi.org/10.1007/s11238-007-9035-5
Güth, Werner and Mengel, Friederike and Ockenfels, Axel (2007) An Evolutionary Analysis of Buyer Insurance and Seller Reputation in Online Markets. Theory and Decision, 63 (3). pp. 265-282. DOI https://doi.org/10.1007/s11238-007-9035-5
Abstract
Applying an evolutionary framework, we investigate how a reputation mechanism and a buyer insurance (as used on Internet market platforms such as eBay) interact to promote trustworthiness and trust in markets with moral hazard problems. Our analysis suggests that the costs involved in giving reliable feedback determine the gains from trade that can be obtained in equilibrium. Buyer insurance, on the other hand, can affect the trading dynamics and equilibrium selection. We find that, under reasonable conditions, buyer insurance crowds out trust, and trustworthiness. © 2007 Springer Science+Business Media, LLC.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | Trust; online markets; eBay; reputation mechanism; moral hazard; evolutionary game theory |
| Subjects: | H Social Sciences > HB Economic Theory |
| Divisions: | Faculty of Social Sciences Faculty of Social Sciences > Economics, Department of |
| SWORD Depositor: | Unnamed user with email elements@essex.ac.uk |
| Depositing User: | Unnamed user with email elements@essex.ac.uk |
| Date Deposited: | 27 Mar 2013 16:22 |
| Last Modified: | 30 Oct 2024 16:40 |
| URI: | http://repository.essex.ac.uk/id/eprint/5811 |