When and Why Do Buyers Rate in Online Markets?

Online ratings play an important role in many markets. We study the often disputed information content of these ratings, by proposing a reduced-form Bayesian model of the typical buyer's rating decision. Our empirical evidence based on eBay raw data is in line with even intricate predictions from it. We thus have good reasons to calibrate the model to moments of the data. Our simulations suggest that the rating record reveals the seller's type after about 100 transactions, or 65-70 ratings.

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Year of publication:	2022
Authors:	Hui, Xiang ; Klein, Tobias J. ; Stahl, Konrad O.
Publisher:	Munich : Center for Economic Studies and ifo Institute (CESifo)
Subject:	online markets \| rating \| reputation

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Series:	CESifo Working Paper ; 9562
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	1789526906 [GVK] hdl:10419/252079 [Handle] RePec:ces:ceswps:_9562 [RePEc]
Classification:	D83 - Search, Learning, Information and Knowledge ; L12 - Monopoly; Monopolization Strategies ; L13 - Oligopoly and Other Imperfect Markets ; L81 - Retail and Wholesale Trade; Warehousing
Source:	EconStor

Persistent link: https://www.econbiz.de/10013177596