Eliciting Honest Feedback in Electronic Markets

Nolan Miller, Paul Resnick and Richard Zeckhauser
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Nolan Miller: Harvard U
Paul Resnick: U of Michigan

Working Paper Series from Harvard University, John F. Kennedy School of Government

Abstract: Recommender and reputation systems seek to inform potential customers by securing current consumers' feedback about products and sellers. This paper proposes a payment-based system to induce honest reporting of feedback. The system applies proper scoring rules to each buyer's report, looking to how well it predicts the report of a later buyer. Honest reporting proves to be a Nash Equilibrium. To balance the budget, the incentive payment to each buyer is charged to someone other than the one whose report that buyer is asked to predict. In addition, payment schemes can be scaled to induce appropriate effort by raters.

Date: 2002-09
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:ecl:harjfk:rwp02-039

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