Publication

Social Structure and Trust in Massive Digital Markets

International Conference on Information Systems (ICIS)


Abstract

Embedding games in networks creates trust when the network is sufficiently dense and/or the players are sufficiently central. But, while much existing research examines how formal reputation signals, like ratings or reviews, enhance trust and facilitate market transactions, almost no research explores the role of networked social signals in generating trust in such marketplaces. Here, we measure the extent to which situating transactions in networks can generate trust in online marketplaces with an empirical approach that provides external validity while eliminating many potential confounds. Using micro-level data on ~1.6M sales posts in Facebook buy and sell groups, we find that both increased network density and seller degree centrality increase two-sided interest in transacting. These results suggest that network structure can produce trust in marketplace transactions and imply that network-based trust mechanisms can offer an appealing alternative to formal reputation systems in mitigating moral hazard and adverse selection in digital marketplaces.

Related Publications

All Publications

Understanding What Software Engineers Are Working On

Ralf Lämmel, Alvin Kerber, Liane Praza

ICPC Industry Track - May 14, 2020

Ownership at Large – Open Problems and Challenges in Ownership Management

John Ahlgren, Maria Eugenia Berezin, Kinga Bojarczuk, Elena Dulskyte, Inna Dvortsova, Johann George, Natalija Gucevska, Mark Harman, Shan He, Ralf Lämmel, Erik Meijer, Silvia Sapora, Justin Spahr-Summers

ICPC Industry Track - May 14, 2020

Don’t Let Me Be Misunderstood: Comparing Intentions and Perceptions in Online Discussions

Jonathan Chang, Justin Cheng, Cristian Danescu-Niculescu-Mizil

CHI - April 20, 2020

WES: Agent-based User Interaction Simulation on Real Infrastructure

John Ahlgren, Maria Eugenia Berezin, Kinga Bojarczuk, Elena Dulskyte, Inna Dvortsova, Johann George, Natalija Gucevska, Mark Harman, Ralf Lämmel, Erik Meijer, Silvia Sapora, Justin Spahr-Summers

Genetic Improvement Workshop - April 29, 2020

To help personalize content, tailor and measure ads, and provide a safer experience, we use cookies. By clicking or navigating the site, you agree to allow our collection of information on and off Facebook through cookies. Learn more, including about available controls: Cookies Policy