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October 11, 2006

Enhancing eBay's reputation system

So I had this idea about newcomers to eBay, and how, now that eBay is a mature system, it has many sellers with very high positive ratings. Compared to these 'old timers', these newcomers can seem untrustworthy, because in modern society, we don't tend to trust people we don't know (or at least trust people that many others have trusted before). This is sensible and understandable, and there are many reasons why eBay's system works.

In Resnick et al's paper "Reputation Systems: Facilitating Trust in Internet Interactions", newcomers must undergo the long task of earning their reputation, because this is the only way of ensuring trustworthiness. But i feel that in the real world, effective business is often done using another method -- that of having connections. There's the common phrase "it's not what you know but who you know", and many business deals happen not in a board room but casually on the golf course or over dinner and drinks.

To extend this into eBay terms, one can think of a reputations network - not ratings of isolated individuals (of course one could always stay isolated) but of people who know other people. Through this network, a buyer could determine the relative trustworthiness of someone based on that person's relationship to someone else. This way, newcomers who had friends who were long-time sellers could link up with these friends and earn, via this relationship, a degree of trustworthiness (if indeed their friends have a highly positive score). This would be done in some sort of percentage fashion, such that the newcomer would get a boost, but not of course have anything close to equal that of their long-time seller friend. Likewise, the long-time seller friend would share the relationship with the newcomer, slightly increasing their score when the newcomer receives positive scores, and also decreasing when the newcomer gets negative scores. This would be the incentive and the check-and-balance mechanism to prevent long-time sellers from just teaming up with anyone -- the newcomer had better do well, or else the long-time seller's hard-earned score will start to degrade.

So, i wonder: has eBay ever considered something like this? Would this enhancement work? If i don't post this idea here, it will sit bottled up inside my head forever, because i doubt i will be able to act on anything like this in the near future. But somebody else may... if so, can you spare maybe 10% of your million-dollar deal? :)

Posted by MaTT at October 11, 2006 09:06 PM

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Posted by: Gwenhoivar at November 7, 2006 03:20 PM

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