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Buyer feedback as a filtering mechanism for reputable sellers

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Author Info

  • Paolo Laureti
  • Frantisek Slanina
  • Yi-Kuo Yu
  • Yi-Cheng Zhang

Abstract

We propose a continuum model for the description of buyer and seller dynamics in an Internet market. The relevant variables are the research effort of buyers and the sellers' reputation building process. We show that, if a commercial website gives consumers the possibility to rate credibly sellers they bargained with, vendors are forced to be more honest. This leads to mutual beneficial symbiosis between buyers and sellers; the overall enhanced volume of transactions contributes ultimately to the website, which facilitates the matchmaking service.

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File URL: http://129.3.20.41/eps/game/papers/0307/0307001.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Game Theory and Information with number 0307001.

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Length: 19 pages
Date of creation: 16 Jul 2003
Date of revision:
Handle: RePEc:wpa:wuwpga:0307001

Note: Type of Document - Postscript; prepared on linux; to print on PostScript; pages: 19; figures: included. Published on Physica A 316 (2002) 413
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Web page: http://129.3.20.41

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Related research

Keywords: Asymmetric information; Internet commerce; Reputation mechanism;

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Cited by:
  1. Yannick Gabuthy & Nicolas Jacquemet & Nadège Marchand, 2008. "Does Resorting to Online Dispute Resolution Promote Agreements? Experimental Evidence," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00259453, HAL.

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