The Value of Reputation on eBay: A Controlled Experiment

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Speaker
Paul Resnick
Associate Professor, School of Information, University of Michigan

When
-

Where
Newell-Simon Hall 1305 (Michael Mauldin Auditorium)

Description

We conducted the first randomized controlled study of an Internet reputation mechanism. A high-reputation, established eBay dealer sold matched pairs of items—batches of vintage postcards—under his regular identity and new seller identities (also operated by him). As predicted, the established identity fared better. The difference in buyers willingness-to-pay was 8.1% of the selling price. A subsidiary experiment followed the same format, but compared sales by relatively new sellers with and without negative feedback. Surprisingly, one or two negative feedbacks for our new sellers did not affect buyers willingness-to-pay.

Speaker's Bio

Paul Resnick is an Associate Professor at the University of Michigan School of Information, on sabbatical at Carnegie-Mellon for the 2003–2004 academic year. His research focuses on Socio-technical Capital, productive social relations that are enabled by the ongoing use of information and communication technology. This paper is part of a larger project to understand the conditions under which reputation systems should work to create trust among strangers, how they are actually working, and how they might be designed to work better.

Speaker's Website
https://www.si.umich.edu/people/paul-resnick