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The Dynamics of the Electronic Market: An Evolutionary Game Approach

Author

Listed:
  • Sulin Ba

    (University of Southern California)

  • Andrew B. Whinston

    (University of Texas at Austin)

  • Han Zhang

    (University of Texas at Austin)

Abstract

The capabilities afforded by network technologies have facilitated the growth of electronic commerce. However, online frauds pose serious challenges to the further adoption of the electronic market. In order to promote trust and reduce transaction risks, various trusted third parties have emerged and new models have been proposed. Will people use the trusted third parties while conducting online transactions? How will the electronic market evolve? This research attempts to identify the different equilibria of the electronic market using an evolutionary game theoretic approach and to explore the best strategy to do transactions in the electronic market. Also, the work provides a theoretical justification to the emergence and necessity of trusted third parties for electronic transactions.

Suggested Citation

  • Sulin Ba & Andrew B. Whinston & Han Zhang, 2000. "The Dynamics of the Electronic Market: An Evolutionary Game Approach," Information Systems Frontiers, Springer, vol. 2(1), pages 31-40, January.
    • Handle: RePEc:spr:infosf:v:2:y:2000:i:1:d:10.1023_a:1010041819361
    DOI: 10.1023/A:1010041819361
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    References listed on IDEAS

    as
    1. George J. Mailath, 1998. "Do People Play Nash Equilibrium? Lessons from Evolutionary Game Theory," Journal of Economic Literature, American Economic Association, vol. 36(3), pages 1347-1374, September.
    2. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
    3. George J. Mailath, 1998. "Do People Play Nash Equilibrium? Lessons from Evolutionary Game Theory," Journal of Economic Literature, American Economic Association, vol. 36(3), pages 1347-1374, September.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Hideyasu Sasaki, 2011. "A computing theory for collaborative and transparent decision making under time constraint," Information Systems Frontiers, Springer, vol. 13(2), pages 207-220, April.
    2. Xiaolong Zheng & Daniel Zeng & Fei-Yue Wang, 2015. "Social balance in signed networks," Information Systems Frontiers, Springer, vol. 17(5), pages 1077-1095, October.
    3. Xiong Zhang & Xin Zhang & Xuechen Luo & Wei T. Yue, 2022. "The Impact of Revenue Models on Anti-Counterfeiting Measures for Online Intermediaries," Information Systems Frontiers, Springer, vol. 24(6), pages 1905-1928, December.

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