Competition Fosters Trust

Publikation: Working paperForskning

Standard

Competition Fosters Trust. / Huck, Steffen; Ruchala, Gabriele K.; Tyran, Jean-Robert.

Cph. : Department of Economics, University of Copenhagen, 2006.

Publikation: Working paperForskning

Harvard

Huck, S, Ruchala, GK & Tyran, J-R 2006 'Competition Fosters Trust' Department of Economics, University of Copenhagen, Cph. <https://www.econ.ku.dk/Research/Publications/pink/2006/0622.pdf>

APA

Huck, S., Ruchala, G. K., & Tyran, J-R. (2006). Competition Fosters Trust. Department of Economics, University of Copenhagen. https://www.econ.ku.dk/Research/Publications/pink/2006/0622.pdf

Vancouver

Huck S, Ruchala GK, Tyran J-R. Competition Fosters Trust. Cph.: Department of Economics, University of Copenhagen. 2006.

Author

Huck, Steffen ; Ruchala, Gabriele K. ; Tyran, Jean-Robert. / Competition Fosters Trust. Cph. : Department of Economics, University of Copenhagen, 2006.

Bibtex

@techreport{00aa1fc0a48011dbbee902004c4f4f50,
title = "Competition Fosters Trust",
abstract = "We study the effects of reputation and competition in a stylized market for experience goods. If interaction is anonymous, such markets perform poorly: sellers are not trustworthy, and buyers do not trust sellers. If sellers are identifiable and can, hence, build a reputation, efficiency quadruples but is still at only a third of the first best. Adding more information by granting buyers access to all sellers{\textquoteright} complete history has, somewhat surprisingly, no effect. On the other hand, we find that competition, coupled with some minimal information, eliminates the trust problem almost completely",
keywords = "Faculty of Social Sciences, experience goods, competition, trust, moral hazard, reputation",
author = "Steffen Huck and Ruchala, {Gabriele K.} and Jean-Robert Tyran",
note = "JEL Classification: C72, C92, D40, L14",
year = "2006",
language = "English",
publisher = "Department of Economics, University of Copenhagen",
address = "Denmark",
type = "WorkingPaper",
institution = "Department of Economics, University of Copenhagen",

}

RIS

TY - UNPB

T1 - Competition Fosters Trust

AU - Huck, Steffen

AU - Ruchala, Gabriele K.

AU - Tyran, Jean-Robert

N1 - JEL Classification: C72, C92, D40, L14

PY - 2006

Y1 - 2006

N2 - We study the effects of reputation and competition in a stylized market for experience goods. If interaction is anonymous, such markets perform poorly: sellers are not trustworthy, and buyers do not trust sellers. If sellers are identifiable and can, hence, build a reputation, efficiency quadruples but is still at only a third of the first best. Adding more information by granting buyers access to all sellers’ complete history has, somewhat surprisingly, no effect. On the other hand, we find that competition, coupled with some minimal information, eliminates the trust problem almost completely

AB - We study the effects of reputation and competition in a stylized market for experience goods. If interaction is anonymous, such markets perform poorly: sellers are not trustworthy, and buyers do not trust sellers. If sellers are identifiable and can, hence, build a reputation, efficiency quadruples but is still at only a third of the first best. Adding more information by granting buyers access to all sellers’ complete history has, somewhat surprisingly, no effect. On the other hand, we find that competition, coupled with some minimal information, eliminates the trust problem almost completely

KW - Faculty of Social Sciences

KW - experience goods

KW - competition

KW - trust

KW - moral hazard

KW - reputation

M3 - Working paper

BT - Competition Fosters Trust

PB - Department of Economics, University of Copenhagen

CY - Cph.

ER -

ID: 312744