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Title:
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HOW PEER TO PEER MECHANISMS SUCH AS ELECTRONIC REPUTATION MAY IMPROVE E-MARKET EFFICIENCY: THE CASE OF E-BAY |
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Author(s):
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Remy Juston-coumat |
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ISBN:
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972-8924-23-2 |
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Editors:
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Sandeep Krishnamurthy and Pedro Isaías |
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Year:
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2006 |
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Edition:
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Single |
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Keywords:
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P2P, reputation, community, trust, e Bay, transaction costs. |
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Type:
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Full Paper |
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First Page:
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159 |
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Last Page:
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166 |
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Language:
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English |
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Cover:
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Full Contents:
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click to dowload 
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Paper Abstract:
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How can we give to on-line markets more economic value? For Akerlof (1970), a market with asymmetrical information may experience a market failure. On-line markets, such as those created by e Bay or similar sites are characterised by a high level of information asymmetry. Why not giving more economic values to on-line markets (such as the market created by e Bay) thanks to the measure of reputation? Measuring reputation may help to decrease information asymmetry. And decreasing information asymmetry helps market efficiency. On-line transactions are only a specific type of transactions. These transactions link two agents A and B, during a short duration of time (this duration is often shorter than for a more classical transaction): usually agent A needs a good G that agent B owns. The transaction allows agents A and B to reach an agreement: B is ready to leave his property rights on G in favour of A and A is ready to give to B a certain amount of money in exchange of the property of G. The lack of information increases transaction costs. Some transaction costs can be deeply reduced thanks to the P2P effects, such as the evaluation of electronic reputation. We propose a model in which electronic reputation of the parties is an important component. As a conclusion, we indicated some hints of further research, such as the impact of P2P mechanisms on the commercial success of these websites, evaluated by sales, benefits or share value by example. |
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