Ruhr Economic Papers

University of Duisburg-Essen, 04/2011, 13 S./p., 8 Euro, ISBN 978-3-86788-295-8

Abstract

This paper studies the role of communication and reputation in market interactions using data from online procurement auctions. Not only positive reputation ratings but also engaging in communication increases a bidder’s probability of winning the auction. Messages are primarily used to reduce the asymmetric information associated with transactions.