Document Type





SEK210, 2/F, Simon & Eleanor Kwok Building


14:00 - 15:30

About the Seminar

Online anonymity has posed a significant threat on online reputation mechanisms and online identity management. How to improve the reliability and effectiveness of online reputation has thus become an important question of theoretical and practical interest. We examine a reputation market in an infinite repeated game setting, where agents sell online services and trade their online reputations. Agents exert effort to provide services and high type agents have a lower cost of effort than low types. An auditor performs random checks on services and determines agents’ reputations. Our analysis depicts a full equilibrium in the reputation system with audit, including separating, partial separating, and pooling equilibrium under different conditions. In particular, we show that full separation can arise as equilibrium such that high-type agents can be sorted out from low-type agents by their reputations, which is in contrast to Tadelis (2002). In a separating equilibrium, reputations become a perfect indicator of agents’ type effort levels, and quality of the services. By proposing online reputations as an asset, our paper generates implication for establishing reliable online environments and promoting online interactions.

Speaker Biography

Hong Xu is an Assistant Professor of Information Systems, Business Statistics and Operations Management at the Hong Kong University of Science and Technology. She holds a Ph.D. of Information System from the University of Texas at Austin. Her research interest lies at the intersection of economics and information systems. Her research portfolio consists of issues related to (i) the economics of online reputations; (ii) the impact of design of auditing mechanisms in online and offline settings. The main objective of her research is to provide normative guidelines to online communities holders so that they can effectively manage the online environment and establish an efficient and reliable community.



Recommended Citation

Xu, H. (2012, June). Online identity management and tradable reputation. Academic seminar presented at Lingnan University, Hong Kong.



To view the content in your browser, please download Adobe Reader or, alternately,
you may Download the file to your hard drive.

NOTE: The latest versions of Adobe Reader do not support viewing PDF files within Firefox on Mac OS and if you are using a modern (Intel) Mac, there is no official plugin for viewing PDF files within the browser window.