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Promotional Reviews: An Empirical Investigation of Online Review Manipulation

Author

Listed:
  • Dina Mayzlin
  • Yaniv Dover
  • Judith Chevalier

Abstract

Firms' incentives to manufacture biased user reviews impede review usefulness. We examine the differences in reviews for a given hotel between two sites: Expedia.com (only a customer can post a review) and TripAdvisor.com (anyone can post). We argue that the net gains from promotional reviewing are highest for independent hotels with single-unit owners and lowest for branded chain hotels with multi-unit owners. We demonstrate that the hotel neighbors of hotels with a high incentive to fake have more negative reviews on TripAdvisor relative to Expedia; hotels with a high incentive to fake have more positive reviews on TripAdvisor relative to Expedia.

Suggested Citation

  • Dina Mayzlin & Yaniv Dover & Judith Chevalier, 2014. "Promotional Reviews: An Empirical Investigation of Online Review Manipulation," American Economic Review, American Economic Association, vol. 104(8), pages 2421-2455, August.
    • Handle: RePEc:aea:aecrev:v:104:y:2014:i:8:p:2421-55
    Note: DOI: 10.1257/aer.104.8.2421
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    More about this item

    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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