Online Business-to-Business Markets for Industrial Product Reuse: Evidence from an Operational Policy Change

Suvrat Dhanorkar (), Karen Donohue () and Kevin Linderman ()
Additional contact information
Suvrat Dhanorkar: Smeal College of Business, Pennsylvania State University, University Park, Pennsylvania 16802
Karen Donohue: Carlson School of Management, University of Minnesota, Minneapolis, Minnesota 55455
Kevin Linderman: Carlson School of Management, University of Minnesota, Minneapolis, Minnesota 55455

Manufacturing & Service Operations Management, 2021, vol. 23, issue 6, 1373-1397

Abstract: Problem definition : We examine the importance of expert services in online materials and waste exchanges (OMWEs), which are online business-to-business markets for coordinating transactions of industrial surplus, by-products, and waste. Academic/practical relevance : OMWEs face unique challenges because of their product mix and market characteristics. Many OMWEs have traditionally relied on a combination of routine services (online aggregation, filtered search, etc.) and expert services (selective and spatial matching, contract facilitation, etc.). Although OMWEs employ varying levels of expert services, the ultimate value of expert services in promoting transactions is not fully understood. From a managerial perspective, our study provides insights into the importance of balancing routine and expert services, offering guidance on when expert services offer the most benefits. From an academic perspective, we expand on the type of product and market attributes that should be considered in tailoring OMWE designs. Methodology : We use transactional data from a unique OMWE setting (MNExchange.org), which consists of approximately 3,500 product listings from 700+ supplier firms, collected during 2001–2007. We use various econometric techniques (survival analysis, regression discontinuity, etc.) to examine the changes in performance, including transaction rates and time to market, attributable to an operational policy change that occurred in 2004. We further conduct a detailed examination of mechanisms, alternative explanations, and counterfactual analysis. Results : The results show that eliminating expert services in OMWEs can adversely affect transaction outcomes in OMWEs. In particular, the results show that OMWEs should consider their product mix and market characteristics when making decisions about the appropriate use of expert services. Managerial implications : The study provides insights for improving the potential of online reuse marketplaces in the circular economy. From a broader perspective, the paper contributes to the debate on the role of technology in sustainable development and technology substitution for human tasks.

Keywords: product reuse; policy change; B2B markets; circular economy; econometric analysis (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
http://dx.doi.org/10.1287/msom.2020.0898 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ormsom:v:23:y:2021:i:6:p:1373-1397

Access Statistics for this article

More articles in Manufacturing & Service Operations Management from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().