The Effect of ID Verification in Online Markets: Evidence from a Field Experiment

Jeffrey A. Livingston () and Patrick A. Scholten ()
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Jeffrey A. Livingston: Bentley University
Patrick A. Scholten: Bentley University

Review of Industrial Organization, 2019, vol. 54, issue 3, No 6, 595-615

Abstract: Abstract eBay’s ID Verify program, which allowed sellers to pay a fee to have their identity confirmed by a credit information company, was designed to alleviate asymmetric information problems in online auctions. We conduct a field experiment where items are sold on eBay by one of four identities that either are or are not ID verified and have either a good or no reputation. We find that ID verification increases the number of bids placed but has no impact on the level of the winning bid, and may even lower the winning bid among sellers who have good reputations.

Keywords: eBay; Online auctions; Reputation; ID verification; Field experiments (search for similar items in EconPapers)
JEL-codes: C9 D12 D82 L14 L15 (search for similar items in EconPapers)
Date: 2019
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DOI: 10.1007/s11151-018-9655-7

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