Trust and Reputation in Internet Auctions

Exchange between anonymous actors in Internet auctions corresponds to a one-shot prisoner's dilemma-like situation. Therefore, in any given auction the risk is high that seller and buyer will cheat and, as a consequence, that the market will collapse. However, mutual cooperation can be attained by the simple and very efficient institution of a public rating system. By this system, sellers have incentives to invest in reputation in order to enhance future chances of business. Using data from about 200 auctions of mobile phones we empirically explore the effects of the reputation system. In general, the analysis of nonobtrusive data from auctions may help to gain a deeper understanding of basic social processes of exchange, reputation, trust, and cooperation, and of the impact of institutions on the efficiency of markets. In this study we report empirical estimates of effects of reputation on characteristics of transactions such as the probability of a successful deal, the mode of payment, and the selling price (highest bid). In particular, we try to answer the question whether sellers receive a "premium" for reputation. Our results show that buyers are willing to pay higher prices for reputation in order to diminish the risk of exploitation. On the other hand, sellers protect themselves from cheating buyers by the choice of an appropriate payment mode. Therefore, despite the risk of mutual opportunistic behavior, simple institutional settings lead to cooperation, relatively rare events of fraud, and efficient markets.

The loss of trust in the European Union during the great recession since 2007: The role of heuristics from the national political system

How can we explain the decline in support for the European Union (EU) and the idea of European integration after the onset of the great recession in the fall of 2007? Did the economic crisis and the austerity policies that the EU imposed—in tandem with the IMF—on several member countries help cause this drop? While there is some evidence for this direct effect of EU policies, we find that the most significant determinant of trust and support for the EU remains the level of trust in national governments. Based on cue theory and using concepts of diffuse and specific support, we find that support for the EU is derived from evaluations of national politics and policy, which Europeans know far better than the remote political system of the EU. This effect, however, is somewhat muted for those sophisticated Europeans that are more knowledgeable about the EU and are able to form opinions about it independently of the national contexts in which they live. We also find that the recent economic crisis has led to a discernible increase in the number of those who are disillusioned with politics both at the national and the supranational level. We analyze 133 national surveys from 27 EU countries by estimating a series of cross-classified multilevel logistic regression models.

The Interplay of Power and Trust in Platform Ecosystems of the Enterprise Application Software Industry

In recent years, the formerly oligopolistic Enterprise Application Software (EAS) industry began to disintegrate into focal inter-firm networks with one huge, powerful, and multi-national plat-form vendor as the center, surrounded by hundreds or even thousands of small, niche players that act as complementors. From a theoretical point of view, these platform ecosystems may be governed by two organizing principles - trust and power. However, it is neither from a practical nor from a theoretical perspective clear, how trust and power relate to each other, i.e. whether they act as complements or substitutes. This study tries to elaborate our understanding of the relationship of trust and power by exploring their interplay using multi-dimensional conceptual-izations of trust and power, and by investigating potential dynamics in this interplay over the course of a partnership. Based on an exploratory multiple-case study of seven dyadic partner-ships between four platform vendors, and seven complementors, we find six different patterns of how trust and power interact over time. These patterns bear important implications for the suc-cessful management of partnerships between platform vendors and complementors, and clarify the theoretical debate surrounding the relationship of trust and power.

Patient Expectations in Internet-Based Self-Help for Social Anxiety

A number of controlled trials have demonstrated the efficacy of Internet-based cognitive-behaviour therapy for treating social anxiety disorder (SAD). However, little is known about what makes those interventions work. The current trial focuses on patient expectations as one common mechanism of change. The study examines whether patients' expectancy predicts outcome, adherence, and dropout in an unguided Internet-based self-help programme for SAD. Data of 109 participants in a 10-week self-help programme for SAD were analysed. Social anxiety measures were administered prior to the intervention, at week 2, and after the intervention. Expectancy was assessed at week 2. Patient expectations were a significant predictor of change in social anxiety (β = - .35 to - .40, all p < .003). Patient expectations also predicted treatment adherence (β = .27, p = .02). Patients with higher expectations showed more adherence and better outcome. Dropout was not predicted by expectations. The effect of positive expectations on outcome was mediated by early symptom change (from week 0 to week 2). Results suggest that positive outcome expectations have a beneficial effect on outcome in Internet-based self-help for SAD. Furthermore, patient expectations as early process predictors could be used to inform therapeutic decisions such as stepping up patients to guided or face-to-face treatment options

Consumer Behavior in Moral Markets. On the Relevance of Identity, Justice Beliefs, Social Norms, Status and Trust in Ethical Consumption

This article addresses ethical consumer behavior and uses the purchase of Fair Trade (FT) coffee to gain insights into determinants of ‘moral behavior’ in the marketplace. Our primary concern is to clarify which theoretical concepts and determinants are more useful than others in explaining FT consumption. We compare the explanatory power of consumer budget restrictions, consumer identity, social and personal norms, social status, justice beliefs, and trust. Our second aim is methodological; we contrast data on self-reported consumption of FT coffee with experimental data on hypothetical choices of different coffee products. To gain insights into the robustness of our measurement and findings, we test our propositions using two samples of undergraduate students from Germany and the United States. Our data show that consumer identity and personal norms are the major determinants of FT consumption in both samples, the results from survey-based data and from our experimental data are similar in this regard. Further, we demonstrate that studies based on a limited number of determinants might overestimate effects; the effect of justice beliefs for instance vanishes if other determinants are taken into account.

The impact of associational life on trust in local institutions: a comparison of 57 Swiss municipalities

In this paper, we evaluate the impact of associational life on individual political trust in 57 Swiss municipalities. Our hierarchical regression models show that individual political trust is not only affected by individual associational membership but also by the exchange between associations and local political authorities in a community. In other words, if political authorities and associations are linked at the community level, citizens will place more trust in their local institutions. Furthermore, we find clear evidence for the rainmaker hypothesis: our results show that the positive effect of a vibrant connection between associational life and local politics on political trust is not solely confined to the associational members themselves, but rather indicate that the structure of the local civic culture fosters political trust among members and non-members at the same time. However, the internal democratic processes of associations have no effect on individuals’ trust in local political institutions.

The accuracy of self-reported medical history: A preliminary analysis of the promise of internet-based research in Inflammatory Bowel Diseases

BACKGROUND AND AIMS: Internet-based surveys provide a potentially important tool for Inflammatory Bowel Disease (IBD) research. The advantages include low cost, large numbers of participants, rapid study completion and less extensive infrastructure than traditional methods. The aim was to determine the accuracy of patient self-reporting in internet-based IBD research and identify predictors of greater reliability. METHODS: 197 patients from a tertiary care center answered an online survey concerning personal medical history and an evaluation of disease specific knowledge. Self-reported medical details were compared with data abstracted from medical records. Agreement was assessed by kappa (κ) statistics. RESULTS: Participants responded correctly with excellent agreement (κ=0.96-0.97) on subtype of IBD and history of surgery. The agreement was also excellent for colectomy (κ=0.88) and small bowel resection (κ=0.91), moderate for abscesses and fistulas (κ=0.60 and 0.63), but poor regarding partial colectomy (κ=0.39). Time since last colonoscopy was self-reported with better agreement (κ=0.84) than disease activity. For disease location/extent, moderate agreements at κ=69% and 64% were observed for patients with Crohn's disease and ulcerative colitis, respectively. Subjects who scored higher than the average in the IBD knowledge assessment were significantly more accurate about disease location than their complementary group (74% vs. 59%, p=0.02). CONCLUSION: This study demonstrates that IBD patients accurately report their medical history regarding type of disease and surgical procedures. More detailed medical information is less reliably reported. Disease knowledge assessment may help in identifying the most accurate individuals and could therefore serve as validity criteria. Internet-based surveys are feasible with high reliability about basic disease features only. However, the participants in this study were engaged at a tertiary center, which potentially leads to a bias and compromises generalization to an unfiltered patient group.

Effectiveness of Justice-Based Measures in Managing Trust and Privacy Concerns on Social Networking Sites: Intercultural Perspective

The unprecedented success of social networking sites (SNSs) has been recently overshadowed by concerns about privacy risks. As SNS users grow weary of privacy breaches and thus develop distrust, they may restrict or even terminate their platform activities. In the long run, these developments endanger SNS platforms’ financial viability and undermine their ability to create individual and social value. By applying a justice perspective, this study aims to understand the means at the disposal of SNS providers to leverage the privacy concerns and trusting beliefs of their users—two important determinants of user participation on SNSs. Considering that SNSs have a global appeal, empirical tests assess the effectiveness of justice measures for three culturally distinct countries: Germany, Russia and Morocco. The results indicate that these measures are particularly suited to address trusting beliefs of SNS audience. Specifically, in all examined countries, procedural justice and the awareness dimension of informational justice improve perceptions of trust in the SNS provider. Privacy concerns, however, are not as easy to manage, because the impact of justice-based measures on privacy concerns is not universal. Beyond theoretical value, this research offers valuable practical insights into the use of justice-based measures to promote trust and mitigate privacy concerns in a cross-cultural setting.