Commerce depends on buyers and sellers fulfilling their contractual obligations; mechanisms inducing such performance are essential to well-functioning markets. Internet-enabled reputation mechanisms that collect and disseminate consumer feedback have emerged as prominent means for inducing...

Online reputation mechanisms are emerging as a promising alternative to more established mechanisms for promoting trust and cooperative behavior, such as legally enforceable contracts. As information technology dramatically reduces the cost of accumulating, processing and disseminating consumer...

Electronic brokerages on the Internet represent one of the most successful examples ofelectronic commerce, having captured over 20% of retail stock trades. According toeconomic theory, prices of commodities like securities should converge to one price in amarket with the transparency of the...

We study the strategy of bundling a large number of information goods, such as those increasingly available on the Internet, and selling them for a fixed price. We analyze the optimal bundling strategies for a multiproduct monopolist, and we find that bundling very large numbers of unrelated...

A cornerstone of the law and economics approach to standard-form contracts is the informed-minority hypothesis: in competitive markets, a minority of term-conscious buyers is sufficient to discipline sellers from using unfavorable boilerplate terms. This argument is often invoked to limit...