Vorlesung 4: Reputation and Trust

Question 1

The issue of “platform leakage” (or circumvention, or dis-intermediation)

Answer 1

What drives platform leakage:
▪ Low added value by the platform
▪ Low trust requirements
▪ High commission fees
▪ Tedious user experience and interfaces
▪ Easy access/ communication between users
▪ Repeated interactions

Question 2

Motives and prerequisites for peer-to-peer (P2P) sharing
A classification of sharing types

Answer 2

Question 3

Factors impacting users platform usage intention

Answer 3

Question 4

Trust can be defined as …

Answer 4

“… the willingness of a party to be vulnerable to the actions of another party based on the expectation that the other will perform a particular action important to the trustor, irrespective of the ability to monitor or control that other party.”

Mayer et al. 1995, p. 712

Question 5

How to identify who orders/creates fake reviews?

Answer 5

Case: Hotels
General idea
▪ Examine the differences in reviews for
a given hotel between two sites:
▪ Expedia.com (only a customer can post
a review)
▪ TripAdvisor.com (anyone can post)

Findings
▪ A firm that is located close to a competitor will have more fake negative reviews than a firm with no close neighbors
▪ A firm that is part of a smaller entity will have more positive fake reviews
▪ A firm that is located close to a smaller entity competitor will have more fake negative reviews

Question 6

Signaling Theory
Illustration

Answer 6

At least two parties
▪ Information asymmetry: Signaler or product quality unknown to receiver

Question 7

Signaling Theory

Answer 7

▪ Signaling Theory is a framework to model and understand behaviors of information asymmetry reduction between actors
▪ As always: “All models are wrong, but some are useful.” (George Box)
▪ The theory assumes two parties with information asymmetry and at least partly
conflicting interests
▪ Typically, one party has limited information on the transaction object’s quality, where quality can be defined as “the underlying, unobservable ability of the signaler to fulfill the needs or demands” (Connelly et al., 2011, p. 43)
▪ This uncertainty prevents transactions from happening or makes them costly
▪ To address this asymmetry and hence to facilitate transactions, the signaler transmits a
signal to the receiver (actively or passively)
▪ The theory roots in evolutionary biology but is now well-established within the social
sciences in general, and in economics in particular
▪ There exist different types of signals of different “power”

Question 8

Signaling Theory

Assessment Signals
related to trait, hard to fake

Answer 8

Question 9

Dimensions, targets, and types of trust

Answer 9

Dimensions (for human-like trust)
▪ Ability (… has the appropriate skills and competences)
▪ Benevolence (… wants to do good to the trustor)
▪ Integrity (… adheres to appropriate and accepted rules of conduct; … are true to their
word)
Targets
▪ Trust in Peer / Individual (e.g., host, provider, seller)
▪ Trust in Platform (e.g., Airbnb, Drivy, eBay)
▪ Trust in Product / System (e.g., apartment, car, product)
Types of trust
▪ Trusting Belief (stated belief into the other party’s trustworthiness)
▪ Trusting Intention (stated willingness to trust)
▪ Trusting Behavior (realized/manifested trust through action)
▪ Initial Trust vs. Experience-based Trust (i.e., based on personal transactional history)
▪ Swift Trust (ad-hoc emergence of trust in temporary groups)

Question 10

Reputation portability

Answer 10

Question 11

Reputation portability
Right

Answer 11