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THE DYNAMICS OF SELLER REPUTATION: EVIDENCE FROM EBAY*

Luis Cabral () and Ali Hortaçsu

Journal of Industrial Economics, 2010, vol. 58, issue 1, 54-78

Abstract: We construct a panel of eBay seller histories and examine the importance of eBay's reputation mechanism. We find that, when a seller first receives negative feedback, his weekly sales rate drops from a positive 5% to a negative 8%; subsequent negative feedback ratings arrive 25% more rapidly than the first one and don't have nearly as much impact as the first one. We also find that a seller is more likely to exit the lower his reputation is; and that, just before exiting, sellers receive more negative feedback than their lifetime average.

Date: 2010
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https://doi.org/10.1111/j.1467-6451.2010.00405.x

Related works:
Working Paper: The Dynamics of Seller Reputation: Evidence from eBay (2006)
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Journal of Industrial Economics is currently edited by Pierre Regibeau, Yeon-Koo Che, Kenneth Corts, Thomas Hubbard, Patrick Legros and Frank Verboven

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