Consumer Networks and Firm Reputation: A First Experimental Investigation
Publikation: Working paper › Forskning
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Consumer Networks and Firm Reputation : A First Experimental Investigation. / Huck, Steffen; Lünser, Gabriele K.; Tyran, Jean-Robert.
Department of Economics, University of Copenhagen, 2007.Publikation: Working paper › Forskning
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TY - UNPB
T1 - Consumer Networks and Firm Reputation
T2 - A First Experimental Investigation
AU - Huck, Steffen
AU - Lünser, Gabriele K.
AU - Tyran, Jean-Robert
N1 - JEL Classification: C72, C92, D40, L14
PY - 2007
Y1 - 2007
N2 - Arguing that consumers are the carriers of firms' reputations, we examine the role of consumer networks for trust in markets that suffer from moral hazard. When consumers are embedded in a network, they can exchange information with their neighbours about their private experiences with different sellers. We find that such information exchange fosters firms' incentives for reputation building and, thus, enhances trust and efficiency in markets. This efficiency-enhancing effect is already achieved with a rather low level of network density
AB - Arguing that consumers are the carriers of firms' reputations, we examine the role of consumer networks for trust in markets that suffer from moral hazard. When consumers are embedded in a network, they can exchange information with their neighbours about their private experiences with different sellers. We find that such information exchange fosters firms' incentives for reputation building and, thus, enhances trust and efficiency in markets. This efficiency-enhancing effect is already achieved with a rather low level of network density
KW - Faculty of Social Sciences
KW - trust
KW - consumer economics
KW - moral hazard
KW - information conditions
KW - reputation
M3 - Working paper
BT - Consumer Networks and Firm Reputation
PB - Department of Economics, University of Copenhagen
ER -
ID: 1524855