The Traveling Reviewer Problem – Exploring the Relationship between Offline Locations and Online Rating Behavior

Jürgen Neumann, Dominik Gutt () and Dennis Kundisch ()
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Jürgen Neumann: Paderborn University
Dominik Gutt: Paderborn University
Dennis Kundisch: Paderborn University

No 44, Working Papers Dissertations from Paderborn University, Faculty of Business Administration and Economics

Abstract: Amongst the growing body of literature on the drivers of online ratings, the influence of customers’ local offline environment on their ratings has largely been neglected. This study examines the relationship between ratings made outside of a customer’s home area, i.e., when traveling, and the magnitude of online ratings. In line with our theory, we find that customers who rate while traveling give, on average, higher ratings than locals. This relationship is moderated by the posting time of a review relative to consumption, as travelers also post more positive ratings during or shortly after consumption compared to locals. Our identification strategy leverages panel data to control for unobservable reviewer heterogeneity and a clustering approach to mitigate reviewer-restaurant selection biases. We also investigate several additional factors such as travel distance, identification strategy of a reviewer’s home city, and the size of the home city relative to the size of the travel destination. Our results come with substantial implications for a business’ average rating and for customer decision making.

Keywords: Online Ratings; Online Offline Interplay; Econometrics; Affective (Mis-)Forecasting (search for similar items in EconPapers)
JEL-codes: D12 M15 M31 O32 (search for similar items in EconPapers)
Pages: 26
Date: 2018-12
New Economics Papers: this item is included in nep-ure
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