Designing Online Marketplaces: Trust and Reputation Mechanisms

Michael Luca

No 22616, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Online marketplaces have proliferated over the past decade, creating new markets where none existed. By reducing transaction costs, online marketplaces facilitate transactions that otherwise would not have occurred and enable easier entry of small sellers. One central challenge faced by designers of online marketplaces is how to build enough trust to facilitate transactions between strangers. This paper provides an economist’s toolkit for designing online marketplaces, focusing on trust and reputation mechanisms.

JEL-codes: D47 D8 J15 (search for similar items in EconPapers)
Date: 2016-09
New Economics Papers: this item is included in nep-ict, nep-soc and nep-sog
Note: IO LE LS PR
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published as Designing Online Marketplaces: Trust and Reputation Mechanisms , Michael Luca. in Innovation Policy and the Economy, Volume 17 , Greenstein, Lerner, and Stern. 2017

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