Please use this identifier to cite or link to this item: https://hdl.handle.net/10356/97962
Title: Design of an incentive mechanism to promote honesty in e-marketplaces with limited inventory
Authors: Liu, Yuan
Zhang, Jie
Li, Qin
Keywords: DRNTU::Engineering::Computer science and engineering
Issue Date: 2012
Source: Liu, Y., Zhang, J., & Li, Q. (2012). Design of an incentive mechanism to promote honesty in e-marketplaces with limited inventory. Proceedings of the 14th Annual International Conference on Electronic Commerce.
Abstract: In e-marketplaces with limited inventory where buyers' demand is larger than sellers' supply, promoting honesty raises new challenges: sellers may behave dishonestly because they can sell out all products without the necessity of gaining high reputation; buyers may provide untruthful ratings to mislead other buyers in order to have a higher chance to obtain the limited products. In this paper, we propose a novel incentive mechanism to promote honesty in such e-marketplaces. More specifically, our mechanism models both buyer and seller honesty. It offers higher prices to the products provided by honest sellers so that the sellers can gain more profit. Honest buyers also have a higher chance to do business with honest sellers and are able to gain more utility. Theoretical analysis and experimental results show that our mechanism promotes both buyer and seller honesty. Finally, we address the re-entry problem by imposing membership fees on new sellers. We show that the membership fee can discourage sellers from re-entry both in theoretical analysis and experimental validation.
URI: https://hdl.handle.net/10356/97962
http://hdl.handle.net/10220/12264
DOI: http://dx.doi.org/10.1145/2346536.2346546
Rights: © 2012 ACM.
Fulltext Permission: none
Fulltext Availability: No Fulltext
Appears in Collections:SCSE Conference Papers

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