Reputation Stretching in Online Auctions

• Main Authors: CHEN, Jianqing, LIN, Mei, WHINSTON, Andrew B.
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2006
• Subjects: Reputation Stretching; Online Auctions; Keyword Auctions; Computer Sciences; Management Information Systems
• Online Access: https://ink.library.smu.edu.sg/sis_research/1724; https://ink.library.smu.edu.sg/context/sis_research/article/2723/viewcontent/LinMei_2006_ReputationWeb1C_1.pdf
• Institution: Singapore Management University

Reputation systems are ubiquitously employed in the online marketplaces to provide information on users’ abilities and trustworthiness. We focus particularly on the problem of reputation stretching, the extension of an established reputation into a new market. By examining various factors—market size, the expected performance in the expanding market, and the risk of performance in the expanding market—we characterize conditions that affect bidder’s stretching decision in the expanding market. Moreover, we analyze both the short-term and the long-term expanding cases, and obtain contrasting results in the two settings.