imnotteixeira
commented
3 years ago Shows examples of how multiple platforms handle their user reputations.
States prevention of moral hazard as an objective of Reputation Systems:
- reputation systems can deter moral hazard by acting as sanctioning devices. If the community punishes users with a history of bad behavior and if the punishment exceeds the gains from "cheating", then the threat of public revelation of a user's cheating behavior is an incentive for users to cooperate instead.
Elaborates further on the reputation dynamics:
- Initial Phase - In most cases, reputation effects begin to work immediately and in fact are strongest during the initial phase, when users must work hard to establish a reputation. A case where reputation effects may fail to work is when short-run players are “too cautious” when compared to the long-run player and therefore update their beliefs too slowly in order for the long-run user to find it profitable to try to build a reputation.
- Steady state (or lack thereof) - In their simplest form, reputation games are characterized by an equilibrium in which the long-run player repeatedly plays the Stackelberg action with high probability and the player’s reputation converges to the Stackelberg type (Stackelberg action is the safe-bet action, always collaborating and no cheating)
These dynamics have important repercussions for reputation systems (for example, eBay, under the assumption that there exist rational and honest seller types). If eBay makes the entire feedback history of a seller available to buyers and if an eBay seller stays on the system long enough, once he establishes an initial reputation for honesty will be tempted to cheat buyers every now and then. In the long term, this behavior will lead to an eventual collapse of his reputation and therefore of cooperative behavior.
https://www.mv.helsinki.fi/home/aula/Top20/dellarocas-reputation-mechanisms.pdf
Reputation mechanisms harness the bi-directional communication capabilities of theInternet in order to engineer large-scale word-of-mouth networks. Best known so far asa technology for building trust and fostering cooperation in online marketplaces, suchas eBay, these mechanisms are poised to have a much wider impact on organizations.This paper surveys our progress in understanding the new possibilities and challengesthat these mechanisms represent. It discusses some important dimensions in whichInternet-based reputation mechanisms differ from traditional word-of-mouth networksand surveys the most important issues related to their design, evaluation, and use. Itprovides an overview of relevant work in game theory and economics on the topic ofreputation. It discusses how this body of work is being extended and combined withinsights from computer science, marketing, and psychology in order to take into consid-eration the special properties of online environments. Finally, it identifies opportunitiesthat this new area presents for information systems research.