When and Why Do Buyers Rate in Online Markets?

Xiang Hui, Tobias Klein and Konrad O. Stahl

No 9562, CESifo Working Paper Series from CESifo

Abstract: 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.

Keywords: online markets; rating; reputation (search for similar items in EconPapers)
JEL-codes: D83 L12 L13 L81 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-pay
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Related works:
Working Paper: When and Why Do Buyers Rate in Online Markets? (2022)
Working Paper: When and Why Do Buyers Rate in Online Markets? (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_9562

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