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Engineering Trust - Reciprocity in the Production of Reputation Information

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  • Gary Bolton
  • Ben Greiner
  • Axel Ockenfels

Abstract

Reciprocity in feedback giving distorts the production and content of reputation information in a market, hampering trust and trade efficiency. Guided by feedback patterns observed on eBay and other platforms we run laboratory experiments to investigate how reciprocity can be managed by changes in the way feedback information flows through the system, leading to more accurate reputation information, more trust and more efficient trade. We discuss the implications for theory building and for managing the redesign of market trust systems.

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Bibliographic Info

Paper provided by University of Cologne, Department of Economics in its series Working Paper Series in Economics with number 42.

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Date of creation: 24 Feb 2009
Date of revision: 22 Jan 2011
Handle: RePEc:kls:series:0042

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Keywords: market design; reputation; trust; reciprocity; eBay;

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References

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Citations

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Cited by:
  1. Aperjis, Christina & Miao, Yali & Zeckhauser, Richard Jay, 2011. "Variable Temptations and Black Mark Reputations," Scholarly Articles 5027138, Harvard Kennedy School of Government.
  2. Bolton, Gary E. & Ockenfels, Axel, 2014. "Does laboratory trading mirror behavior in real world markets? Fair bargaining and competitive bidding on eBay," Journal of Economic Behavior & Organization, Elsevier, vol. 97(C), pages 143-154.
  3. Bolton, Gary E. & Ockenfels, Axel, 2012. "Behavioral economic engineering," Journal of Economic Psychology, Elsevier, vol. 33(3), pages 665-676.
  4. Axel Ockenfels, 2008. "Marktdesign und Experimentelle Wirtschaftsforschung," Working Paper Series in Economics 41, University of Cologne, Department of Economics.
  5. Benjamin Edelman & Micahel Luca, 2014. "Digital Discrimination: The Case of Airbnb.com," Harvard Business School Working Papers 14-054, Harvard Business School.
  6. Marianne Lumeau & David Masclet & Thierry Pénard, 2013. "Reputation and Social (Dis)approval in Feedback Mechanisms: An Experimental study," Economics Working Paper Archive (University of Rennes 1 & University of Caen) 201343, Center for Research in Economics and Management (CREM), University of Rennes 1, University of Caen and CNRS.

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