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Trust and Reputation Building in E-Commerce

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  • Claudia Keser

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    Abstract

    Transactions on online markets require a great deal of trust among anonymous trading partners. To mitigate some of the risks involved in anonymous transactions, several online market sites have implemented reputation management mechanisms that differ in structure and probably functionality. In a series of experiments, this study examines the impact of two simple reputation management mechanisms on the evolution of trust and trustworthiness in a repeated trust game among strangers. Les transactions par Internet exigent une confiance considérable entre les intervenants anonymes. Pour minimiser les risques associés à des opérations anonymes, les responsables de plusieurs marchés en ligne ont mis en place des mécanismes de gestion de réputation différant en structure et fonctionnalité. Dans une série d'expériences, cette étude évalue l'impact de deux mécanismes relativement simples sur la confiance et la coopération dans un jeu de confiance répété entre étrangers.

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    Bibliographic Info

    Paper provided by CIRANO in its series CIRANO Working Papers with number 2002s-75.

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    Date of creation: 01 Jul 2002
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    Handle: RePEc:cir:cirwor:2002s-75

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    Related research

    Keywords: Trust; Reputation; Experimental Economics; E-commerce; Mondialisation; commerce international; temps de travail; intégration économique;

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    References

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    1. Landon, Stuart & Smith, Constance, 1997. "The Use of Quality and Reputation Indicators by Consumers: The Case of Bordeaux Wine," MPRA Paper 9283, University Library of Munich, Germany.
    2. Georg Kirchsteiger & Ernst Fehr & Arno Riedl, 1993. "Does Fairness Prevent Market Clearing? An Experimental Investigation," ULB Institutional Repository 2013/5927, ULB -- Universite Libre de Bruxelles.
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    4. Fehr, Ernst & Schmidt, Klaus M., . "A theory of fairness, competition, and cooperation," Chapters in Economics, University of Munich, Department of Economics.
    5. Daniel Houser & John Wooders, 2006. "Reputation in Auctions: Theory, and Evidence from eBay," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 15(2), pages 353-369, 06.
    6. La Porta, Rafael, et al, 1997. "Trust in Large Organizations," American Economic Review, American Economic Association, vol. 87(2), pages 333-38, May.
    7. Bernard Ruffieux & Claude Meidinger & Stéphane Robin, 1999. "Confiance, réciprocité et cheap talk," Revue Économique, Programme National Persée, vol. 50(1), pages 5-44.
    8. Selten,Reinhard & Mitzkewitz,Michael & Uhlich,Gerald, . "Duopoly strategies programmed by experienced players," Discussion Paper Serie B 106, University of Bonn, Germany.
    9. Georg Kirchsteiger & Ernst Fehr & Simon Gächter, 1997. "Reciprocity as a contract enforcement device: experimental evidence," ULB Institutional Repository 2013/5911, ULB -- Universite Libre de Bruxelles.
    10. Nancy Buchan & Rachel Croson, 1999. "Gender and Culture: International Experimental Evidence from Trust Games," American Economic Review, American Economic Association, vol. 89(2), pages 386-391, May.
    11. Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
    12. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
    13. Claudia Keser & Frans A.A.M. van Winden, 2000. "Conditional Cooperation and Voluntary Contributions to Public Goods," Tinbergen Institute Discussion Papers 00-011/1, Tinbergen Institute.
    14. Fehr, Ernst, et al, 1998. "When Social Norms Overpower Competition: Gift Exchange in Experimental Labor Markets," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 324-51, April.
    15. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
    16. Claudia Keser, 2000. "Strategically Planned Behavior in Public Good Experiments," CIRANO Working Papers 2000s-35, CIRANO.
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    Cited by:
    1. repec:hal:cesptp:halshs-00259453 is not listed on IDEAS
    2. Axel Ockenfels, 2002. "Reputationsmechanismen auf Internet-Marktplattformen - Theorie und Empirie -," Papers on Strategic Interaction 2002-46, Max Planck Institute of Economics, Strategic Interaction Group.
    3. Huck, Steffen & Lünser, Gabriele K. & Tyran, Jean-Robert, 2012. "Competition fosters trust," Games and Economic Behavior, Elsevier, vol. 76(1), pages 195-209.
    4. Steffen Huck & Gabriele K. Ruchala & Jean-Robert Tyran, 2007. "Pricing and Trust," Discussion Papers 07-04, University of Copenhagen. Department of Economics.
    5. Carsten Schmidt & Tobias Uske, 2004. "Reputationsmechanismen für Informationsgüter auf Internet-Meinungsportalen," Papers on Strategic Interaction 2004-13, Max Planck Institute of Economics, Strategic Interaction Group.
    6. Gabuthy, Yannick & Jacquemet, Nicolas & Marchand, Nadège, 2008. "Does resorting to online dispute resolution promote agreements? Experimental evidence," European Economic Review, Elsevier, vol. 52(2), pages 259-282, February.
    7. Engelmann, Dirk & Fischbacher, Urs, 2009. "Indirect reciprocity and strategic reputation building in an experimental helping game," Games and Economic Behavior, Elsevier, vol. 67(2), pages 399-407, November.
    8. Yannick Gabuthy, 2004. "Online Dispute Resolution and Bargaining," European Journal of Law and Economics, Springer, vol. 17(3), pages 353-371, May.
    9. Chen, Josie I & Kamei, Kenju, 2014. "Expressing Emotion and Fairness Crowding-out in an Ultimatum Game with Incomplete Information," MPRA Paper 54405, University Library of Munich, Germany.
    10. Engle-Warnick, Jim & Slonim, Robert L., 2004. "The evolution of strategies in a repeated trust game," Journal of Economic Behavior & Organization, Elsevier, vol. 55(4), pages 553-573, December.

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