Fixing feedback revision rules in online markets

Feedback withdrawal mechanisms in online markets aim to facilitate the resolution of conflicts during transactions. Yet, frequently used online feedback withdrawal rules are flawed and may backfire by inviting strategic transaction and feedback behavior. Our laboratory experiment shows how a small change in the design of feedback withdrawal rules, allowing unilateral rather than mutual withdrawal, can both reduce incentives for strategic gaming and improve coordination of expectations. This leads to less trading risk, more cooperation, and higher market efficiency.

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Year of publication:	2021
Authors:	Bolton, Gary E. ; Breuer, Kevin ; Greiner, Ben ; Ockenfels, Axel
Publisher:	Bonn and Cologne : University of Bonn and University of Cologne, Reinhard Selten Institute (RSI)
Subject:	dispute resolution system \| market design \| reputation \| trust

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Series:	ECONtribute Discussion Paper ; 070
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	1755007728 [GVK] hdl:10419/237315 [Handle] RePEc:ajk:ajkdps:070 [RePEc]
Classification:	C73 - Stochastic and Dynamic Games ; C9 - Design of Experiments ; D02 - Institutions: Design, Formation, and Operations ; L14 - Transactional Relationships; Contracts and Reputation; Networks
Source:	EconStor

Persistent link: https://www.econbiz.de/10012603351