Reputation mechanisms have become an important component of electronic markets, helping to build trust and elicit cooperation among loosely connected and geographically dispersed economic agents. Understanding the impact of different reputation mechanism design parameters on the resulting market...

Online "feedback mechanisms" - also known as "reputation systems" - have been implemented in the most important private e-markets, such as eBay, Yahoo!, Amazon to foster trust and cooperation among trading partners. In this paper we discuss the main issues relevant for the optimal design of such...