Heart over Heels? An Empirical Analysis of the Relationship between Emotions and Review Helpfulness for Experience and Credence Goods

According to current scholarly and practitioner thinking, one way of enhancing the perceived helpfulness of reviews is by encouraging the use of emotional language. Yet, studies on review helpfulness have paid little attention to studying this effect as it applies to different product types, namely experience and credence goods. Using data from amazon.com, we conduct an empirical test using a natural language understanding algorithm. Our results suggest that for both experience and credence goods, fear, joy, and sadness are correlated with an increase in review helpfulness, whereas anger is negatively correlated with it. These emotions are perceived as more helpful for experience goods than for credence goods

You can\u27t buy my rating! On the pivotal effect of an unconditional gift on rating behavior

The importance of online ratings on sales is widely acknowledged. Firms need to find ways of increasing the number of ratings and rating scores, but how they can achieve this effectively is less well established. In this paper we analyze the impact of an unconditional gift on customers’ rating behavior in an online field experiment. Contrary to prevalent advice, our results suggest that providing a gift is not necessarily beneficial. Younger customers are significantly less likely to rate when exposed to an unconditional gift. Regression analysis reveals that age serves as a moderator and older customers even respond slightly positive to a gift. Having detected a negative effect of gifts on rating behavior provides first indicative evidence of a possible crowding out of intrinsic motivation in the context of online ratings. This has direct implications for practitioners considering the usage of gifts to elicit online ratings

How Free Market Entry Affects Creation and Engagement: Evidence from Non-Fungible Tokens

Content creation costs pose a threat for online marketplaces aiming to attract new users. In response, platform managers devise new policies to subsidize these costs for content creators. In this study, we analyze data from a leading NFT marketplace to examine the impact of a lazy minting policy, which enables content creation without upfront fees, on created content, and engagement with that content. On the creation side, we observe a volume-effort trade-off, with creators producing more work for the market but exerting less effort during creation. On the engagement side, we note a decrease in engagement, particularly affecting creators with higher engagement levels prior to the policy change. We explore the mechanism driving this reduction and find that effort and attention play crucial roles, while a larger follower count does not shield creators from decreased engagement. Finally, we discuss our contributions to the literature and its implications for platform managers

Shelf ice-associated cryo-benthos and environmental features

Incidences of cryo-benthic communities beneath ice shelves are rare and recent discoveries. Combined seal- and ROV-borne imagery and novel sampling technologies allowed for a re-assessment and augmentation of earlier findings on a cryo-benthic isopod community (Antarcturus cf. spinacoronatus), being attached head-down to the underside of floating shelf ice at depths of around 80-150m. The shelf ice-associated cryo-benthos was discovered at Drescher Inlet (-72.83667 -19.15300), Riiser-Larsen Ice Shelf (eastern Weddell Sea). The inlet constitutes a 25km long and between 2 and 4km wide crack in the surrounding shelf ice, which is associated with certain environmental features. Here we compile all available local physical, biological, and biogeochemical data and discuss their relevance in the wider regional context for this faunal hotspot. These include data on shelf, sea and platelet ice, seafloor topography, hydrography and water chemistry, as well as associated pelagic and benthic marine life, in particular affinities of the cryo-benthic isopod community to related fauna occurring in nearby seabed communities using molecular barcoding

Human Practice. Digital Ecologies. Our Future. : 14. Internationale Tagung Wirtschaftsinformatik (WI 2019) : Tagungsband

Erschienen bei: universi - Universitätsverlag Siegen. - ISBN: 978-3-96182-063-4Aus dem Inhalt: Track 1: Produktion & Cyber-Physische Systeme Requirements and a Meta Model for Exchanging Additive Manufacturing Capacities Service Systems, Smart Service Systems and Cyber- Physical Systems—What’s the difference? Towards a Unified Terminology Developing an Industrial IoT Platform – Trade-off between Horizontal and Vertical Approaches Machine Learning und Complex Event Processing: Effiziente Echtzeitauswertung am Beispiel Smart Factory Sensor retrofit for a coffee machine as condition monitoring and predictive maintenance use case Stakeholder-Analyse zum Einsatz IIoT-basierter Frischeinformationen in der Lebensmittelindustrie Towards a Framework for Predictive Maintenance Strategies in Mechanical Engineering - A Method-Oriented Literature Analysis Development of a matching platform for the requirement-oriented selection of cyber physical systems for SMEs Track 2: Logistic Analytics An Empirical Study of Customers’ Behavioral Intention to Use Ridepooling Services – An Extension of the Technology Acceptance Model Modeling Delay Propagation and Transmission in Railway Networks What is the impact of company specific adjustments on the acceptance and diffusion of logistic standards? Robust Route Planning in Intermodal Urban Traffic Track 3: Unternehmensmodellierung & Informationssystemgestaltung (Enterprise Modelling & Information Systems Design) Work System Modeling Method with Different Levels of Specificity and Rigor for Different Stakeholder Purposes Resolving Inconsistencies in Declarative Process Models based on Culpability Measurement Strategic Analysis in the Realm of Enterprise Modeling – On the Example of Blockchain-Based Initiatives for the Electricity Sector Zwischenbetriebliche Integration in der Möbelbranche: Konfigurationen und Einflussfaktoren Novices’ Quality Perceptions and the Acceptance of Process Modeling Grammars Entwicklung einer Definition für Social Business Objects (SBO) zur Modellierung von Unternehmensinformationen Designing a Reference Model for Digital Product Configurators Terminology for Evolving Design Artifacts Business Role-Object Specification: A Language for Behavior-aware Structural Modeling of Business Objects Generating Smart Glasses-based Information Systems with BPMN4SGA: A BPMN Extension for Smart Glasses Applications Using Blockchain in Peer-to-Peer Carsharing to Build Trust in the Sharing Economy Testing in Big Data: An Architecture Pattern for a Development Environment for Innovative, Integrated and Robust Applications Track 4: Lern- und Wissensmanagement (e-Learning and Knowledge Management) eGovernment Competences revisited – A Literature Review on necessary Competences in a Digitalized Public Sector Say Hello to Your New Automated Tutor – A Structured Literature Review on Pedagogical Conversational Agents Teaching the Digital Transformation of Business Processes: Design of a Simulation Game for Information Systems Education Conceptualizing Immersion for Individual Learning in Virtual Reality Designing a Flipped Classroom Course – a Process Model The Influence of Risk-Taking on Knowledge Exchange and Combination Gamified Feedback durch Avatare im Mobile Learning Alexa, Can You Help Me Solve That Problem? - Understanding the Value of Smart Personal Assistants as Tutors for Complex Problem Tasks Track 5: Data Science & Business Analytics Matching with Bundle Preferences: Tradeoff between Fairness and Truthfulness Applied image recognition: guidelines for using deep learning models in practice Yield Prognosis for the Agrarian Management of Vineyards using Deep Learning for Object Counting Reading Between the Lines of Qualitative Data – How to Detect Hidden Structure Based on Codes Online Auctions with Dual-Threshold Algorithms: An Experimental Study and Practical Evaluation Design Features of Non-Financial Reward Programs for Online Reviews: Evaluation based on Google Maps Data Topic Embeddings – A New Approach to Classify Very Short Documents Based on Predefined Topics Leveraging Unstructured Image Data for Product Quality Improvement Decision Support for Real Estate Investors: Improving Real Estate Valuation with 3D City Models and Points of Interest Knowledge Discovery from CVs: A Topic Modeling Procedure Online Product Descriptions – Boost for your Sales? Entscheidungsunterstützung durch historienbasierte Dienstreihenfolgeplanung mit Pattern A Semi-Automated Approach for Generating Online Review Templates Machine Learning goes Measure Management: Leveraging Anomaly Detection and Parts Search to Improve Product-Cost Optimization Bedeutung von Predictive Analytics für den theoretischen Erkenntnisgewinn in der IS-Forschung Track 6: Digitale Transformation und Dienstleistungen Heuristic Theorizing in Software Development: Deriving Design Principles for Smart Glasses-based Systems Mirroring E-service for Brick and Mortar Retail: An Assessment and Survey Taxonomy of Digital Platforms: A Platform Architecture Perspective Value of Star Players in the Digital Age Local Shopping Platforms – Harnessing Locational Advantages for the Digital Transformation of Local Retail Outlets: A Content Analysis A Socio-Technical Approach to Manage Analytics-as-a-Service – Results of an Action Design Research Project Characterizing Approaches to Digital Transformation: Development of a Taxonomy of Digital Units Expectations vs. Reality – Benefits of Smart Services in the Field of Tension between Industry and Science Innovation Networks and Digital Innovation: How Organizations Use Innovation Networks in a Digitized Environment Characterising Social Reading Platforms— A Taxonomy-Based Approach to Structure the Field Less Complex than Expected – What Really Drives IT Consulting Value Modularity Canvas – A Framework for Visualizing Potentials of Service Modularity Towards a Conceptualization of Capabilities for Innovating Business Models in the Industrial Internet of Things A Taxonomy of Barriers to Digital Transformation Ambidexterity in Service Innovation Research: A Systematic Literature Review Design and success factors of an online solution for cross-pillar pension information Track 7: IT-Management und -Strategie A Frugal Support Structure for New Software Implementations in SMEs How to Structure a Company-wide Adoption of Big Data Analytics The Changing Roles of Innovation Actors and Organizational Antecedents in the Digital Age Bewertung des Kundennutzens von Chatbots für den Einsatz im Servicedesk Understanding the Benefits of Agile Software Development in Regulated Environments Are Employees Following the Rules? On the Effectiveness of IT Consumerization Policies Agile and Attached: The Impact of Agile Practices on Agile Team Members’ Affective Organisational Commitment The Complexity Trap – Limits of IT Flexibility for Supporting Organizational Agility in Decentralized Organizations Platform Openness: A Systematic Literature Review and Avenues for Future Research Competence, Fashion and the Case of Blockchain The Digital Platform Otto.de: A Case Study of Growth, Complexity, and Generativity Track 8: eHealth & alternde Gesellschaft Security and Privacy of Personal Health Records in Cloud Computing Environments – An Experimental Exploration of the Impact of Storage Solutions and Data Breaches Patientenintegration durch Pfadsysteme Digitalisierung in der Stressprävention – eine qualitative Interviewstudie zu Nutzenpotenzialen User Dynamics in Mental Health Forums – A Sentiment Analysis Perspective Intent and the Use of Wearables in the Workplace – A Model Development Understanding Patient Pathways in the Context of Integrated Health Care Services - Implications from a Scoping Review Understanding the Habitual Use of Wearable Activity Trackers On the Fit in Fitness Apps: Studying the Interaction of Motivational Affordances and Users’ Goal Orientations in Affecting the Benefits Gained Gamification in Health Behavior Change Support Systems - A Synthesis of Unintended Side Effects Investigating the Influence of Information Incongruity on Trust-Relations within Trilateral Healthcare Settings Track 9: Krisen- und Kontinuitätsmanagement Potentiale von IKT beim Ausfall kritischer Infrastrukturen: Erwartungen, Informationsgewinnung und Mediennutzung der Zivilbevölkerung in Deutschland Fake News Perception in Germany: A Representative Study of People’s Attitudes and Approaches to Counteract Disinformation Analyzing the Potential of Graphical Building Information for Fire Emergency Responses: Findings from a Controlled Experiment Track 10: Human-Computer Interaction Towards a Taxonomy of Platforms for Conversational Agent Design Measuring Service Encounter Satisfaction with Customer Service Chatbots using Sentiment Analysis Self-Tracking and Gamification: Analyzing the Interplay of Motivations, Usage and Motivation Fulfillment Erfolgsfaktoren von Augmented-Reality-Applikationen: Analyse von Nutzerrezensionen mit dem Review-Mining-Verfahren Designing Dynamic Decision Support for Electronic Requirements Negotiations Who is Stressed by Using ICTs? A Qualitative Comparison Analysis with the Big Five Personality Traits to Understand Technostress Walking the Middle Path: How Medium Trade-Off Exposure Leads to Higher Consumer Satisfaction in Recommender Agents Theory-Based Affordances of Utilitarian, Hedonic and Dual-Purposed Technologies: A Literature Review Eliciting Customer Preferences for Shopping Companion Apps: A Service Quality Approach The Role of Early User Participation in Discovering Software – A Case Study from the Context of Smart Glasses The Fluidity of the Self-Concept as a Framework to Explain the Motivation to Play Video Games Heart over Heels? An Empirical Analysis of the Relationship between Emotions and Review Helpfulness for Experience and Credence Goods Track 11: Information Security and Information Privacy Unfolding Concerns about Augmented Reality Technologies: A Qualitative Analysis of User Perceptions To (Psychologically) Own Data is to Protect Data: How Psychological Ownership Determines Protective Behavior in a Work and Private Context Understanding Data Protection Regulations from a Data Management Perspective: A Capability-Based Approach to EU-GDPR On the Difficulties of Incentivizing Online Privacy through Transparency: A Qualitative Survey of the German Health Insurance Market What is Your Selfie Worth? A Field Study on Individuals’ Valuation of Personal Data Justification of Mass Surveillance: A Quantitative Study An Exploratory Study of Risk Perception for Data Disclosure to a Network of Firms Track 12: Umweltinformatik und nachhaltiges Wirtschaften Kommunikationsfäden im Nadelöhr – Fachliche Prozessmodellierung der Nachhaltigkeitskommunikation am Kapitalmarkt Potentiale und Herausforderungen der Materialflusskostenrechnung Computing Incentives for User-Based Relocation in Carsharing Sustainability’s Coming Home: Preliminary Design Principles for the Sustainable Smart District Substitution of hazardous chemical substances using Deep Learning and t-SNE A Hierarchy of DSMLs in Support of Product Life-Cycle Assessment A Survey of Smart Energy Services for Private Households Door-to-Door Mobility Integrators as Keystone Organizations of Smart Ecosystems: Resources and Value Co-Creation – A Literature Review Ein Entscheidungsunterstützungssystem zur ökonomischen Bewertung von Mieterstrom auf Basis der Clusteranalyse Discovering Blockchain for Sustainable Product-Service Systems to enhance the Circular Economy Digitale Rückverfolgbarkeit von Lebensmitteln: Eine verbraucherinformatische Studie Umweltbewusstsein durch audiovisuelles Content Marketing? Eine experimentelle Untersuchung zur Konsumentenbewertung nachhaltiger Smartphones Towards Predictive Energy Management in Information Systems: A Research Proposal A Web Browser-Based Application for Processing and Analyzing Material Flow Models using the MFCA Methodology Track 13: Digital Work - Social, mobile, smart On Conversational Agents in Information Systems Research: Analyzing the Past to Guide Future Work The Potential of Augmented Reality for Improving Occupational First Aid Prevent a Vicious Circle! The Role of Organizational IT-Capability in Attracting IT-affine Applicants Good, Bad, or Both? Conceptualization and Measurement of Ambivalent User Attitudes Towards AI A Case Study on Cross-Hierarchical Communication in Digital Work Environments ‘Show Me Your People Skills’ - Employing CEO Branding for Corporate Reputation Management in Social Media A Multiorganisational Study of the Drivers and Barriers of Enterprise Collaboration Systems-Enabled Change The More the Merrier? The Effect of Size of Core Team Subgroups on Success of Open Source Projects The Impact of Anthropomorphic and Functional Chatbot Design Features in Enterprise Collaboration Systems on User Acceptance Digital Feedback for Digital Work? Affordances and Constraints of a Feedback App at InsurCorp The Effect of Marker-less Augmented Reality on Task and Learning Performance Antecedents for Cyberloafing – A Literature Review Internal Crowd Work as a Source of Empowerment - An Empirical Analysis of the Perception of Employees in a Crowdtesting Project Track 14: Geschäftsmodelle und digitales Unternehmertum Dividing the ICO Jungle: Extracting and Evaluating Design Archetypes Capturing Value from Data: Exploring Factors Influencing Revenue Model Design for Data-Driven Services Understanding the Role of Data for Innovating Business Models: A System Dynamics Perspective Business Model Innovation and Stakeholder: Exploring Mechanisms and Outcomes of Value Creation and Destruction Business Models for Internet of Things Platforms: Empirical Development of a Taxonomy and Archetypes Revitalizing established Industrial Companies: State of the Art and Success Principles of Digital Corporate Incubators When 1+1 is Greater than 2: Concurrence of Additional Digital and Established Business Models within Companies Special Track 1: Student Track Investigating Personalized Price Discrimination of Textile-, Electronics- and General Stores in German Online Retail From Facets to a Universal Definition – An Analysis of IoT Usage in Retail Is the Technostress Creators Inventory Still an Up-To-Date Measurement Instrument? Results of a Large-Scale Interview Study Application of Media Synchronicity Theory to Creative Tasks in Virtual Teams Using the Example of Design Thinking TrustyTweet: An Indicator-based Browser-Plugin to Assist Users in Dealing with Fake News on Twitter Application of Process Mining Techniques to Support Maintenance-Related Objectives How Voice Can Change Customer Satisfaction: A Comparative Analysis between E-Commerce and Voice Commerce Business Process Compliance and Blockchain: How Does the Ethereum Blockchain Address Challenges of Business Process Compliance? Improving Business Model Configuration through a Question-based Approach The Influence of Situational Factors and Gamification on Intrinsic Motivation and Learning Evaluation von ITSM-Tools für Integration und Management von Cloud-Diensten am Beispiel von ServiceNow How Software Promotes the Integration of Sustainability in Business Process Management Criteria Catalog for Industrial IoT Platforms from the Perspective of the Machine Tool Industry Special Track 3: Demos & Prototyping Privacy-friendly User Location Tracking with Smart Devices: The BeaT Prototype Application-oriented robotics in nursing homes Augmented Reality for Set-up Processe Mixed Reality for supporting Remote-Meetings Gamification zur Motivationssteigerung von Werkern bei der Betriebsdatenerfassung Automatically Extracting and Analyzing Customer Needs from Twitter: A “Needmining” Prototype GaNEsHA: Opportunities for Sustainable Transportation in Smart Cities TUCANA: A platform for using local processing power of edge devices for building data-driven services Demonstrator zur Beschreibung und Visualisierung einer kritischen Infrastruktur Entwicklung einer alltagsnahen persuasiven App zur Bewegungsmotivation für ältere Nutzerinnen und Nutzer A browser-based modeling tool for studying the learning of conceptual modeling based on a multi-modal data collection approach Exergames & Dementia: An interactive System for People with Dementia and their Care-Network Workshops Workshop Ethics and Morality in Business Informatics (Workshop Ethik und Moral in der Wirtschaftsinformatik – EMoWI’19) Model-Based Compliance in Information Systems - Foundations, Case Description and Data Set of the MobIS-Challenge for Students and Doctoral Candidates Report of the Workshop on Concepts and Methods of Identifying Digital Potentials in Information Management Control of Systemic Risks in Global Networks - A Grand Challenge to Information Systems Research Die Mitarbeiter von morgen - Kompetenzen künftiger Mitarbeiter im Bereich Business Analytics Digitaler Konsum: Herausforderungen und Chancen der Verbraucherinformati

IN THE EYE OF THE BEHOLDER? – EMPIRICALLY DECOMPOSING DIFFERENT ECONOMIC IMPLICATIONS OF THE ONLINE RATING VARIANCE

The growing body of literature on online ratings has reached a consensus of the positive impact of the average rating and the number of ratings on economic outcomes. Yet, little is known about the econom-ic implication of the variance of online ratings, and existing studies have presented contradictory re-sults. Therefore, this study examines the relationship between the variance of online ratings and the price and sales for digital cameras from Amazon.com. The key feature of our study is that we employ and validate a machine learning approach to decompose the online rating variance into a product fail-ure-related and taste-related share. In line with our theoretical foundation, our empirical results high-light that the failure-related variance share is negatively associated with price and sales, and the taste-related share exhibits a positive relationship with price and sales. Our results highlight a new perspec-tive on the online rating variance that has been largely neglected by prior studies. Sellers can benefit from our results by adjusting their pricing strategy and improving their sales forecasts. Review plat-forms can facilitate the identification of product failure-related ratings to support the purchasing deci-sion process of customers

Essays on drivers and economic outcomes of online reviews

Online-Bewertungen stellen einen wesentlichen Erfolgsfaktor für E-Commerce Plattformen dar. Indem Online-Bewertungen zukünftigen Kunden erlauben von den Erfahrungen früherer Kunden zu lernen, bauen Sie die Informationsasymmetrie zwischen Käufer und Verkäufer vor dem Kauf ab. In letzter Zeit haben sich Forscher intensiv mit den ökonomischen Auswirkungen von Online-Bewertungen und den Treibern von Online-Bewertungen befasst. Nichtsdestotrotz blieben bislang wichtige Forschungsfragen hinsichtlich der Varianz von Online-Bewertungen, der ökonomischen Auswirkung von Online-Bewertung in der Sharing Economy, Treibern von Online-Bewertungen auf der Marktebene und Fragen hinsichtlich des Designs von Online-Bewertungssystemen unbeantwortet. Im Großen und Ganzen untermauern die Ergebnisse meiner Dissertation die Bedeutung des Kontexts, in welchem Online-Bewertungen abgegeben wurden. Bei der ökonomischen Auswirkung der Online-Bewertungsvarianz auf Preise und Verkäufe wird das Vorzeichen dieses Zusammenhangs dadurch bestimmt, ob Bewertungen aufgrund von Produktfehlern oder als Ausdruck subjektiver Empfindungen geschrieben wurden (Gutt 2018). Darüber hinaus wird empirische Evidenz gesammelt, welche die Vermutung unterstützt, dass Online-Bewertungen auch in der Sharing Economy merkliche ökonomische Auswirkungen haben (Neumann et al. 2018a). Umweltbedingeungen auf der Marktebene spielen darüber hinaus eine entscheidende Rolle bei der Entstehung von Online-Bewertungen (Neumann et al. 2018b, Gutt et al. 2018a). Vor dem Hintergrund der rapiden Marktdurchdringung von mannigfaltigen mobilen internetfähigen Endgeräten wird sich zukünftige Forschung zum Design von Online-Bewertungssystemen darüber hinaus stärker mit der Verstrickung von Online- und Offline-Welt beschäftigen müssen (Gutt et al. 2018b).Online reviews represent a cornerstone to the success of many e-commerce platforms. By helping future customers to learn about the experience of past customers, they erode the information asymmetry between buyers and sellers prior to purchase. In recent years, cholars have studied the economic outcomes of online reviews and the factors that drive the generation of reviews. Yet, important research questions on the variance of online ratings, economic outcomes of online reviews in the sharing economy, market-level drivers of reviews, and online review system design have remained unanswered. By and large, my results highlight the value of the individual- and market-level context in which online reviews are generated. In determining the outcome effects of the online rating variance, the sign of the effect depends on whether reviews have been written due to product failure or as an expression of subjective taste (Gutt 2018). Moreover, empirical evidence suggests that online reviews also have economic outcome effects in the sharing economy (Neumann et al. 2018a). Market-level environmental factors of the offline world seem to play a non-negligible role in the generation of online reviews (Neumann et al. 2018b, Gutt et al. 2018a). Finally, the avenues for future online review systems research suggest that the entwinement between online review systems and the offline world will grow even stronger - raising the need for future research - considering the ongoing rise of pervasive mobile internet devices (Gutt et al. 2018b).von Dominik Gutt, M. A.Tag der Verteidigung: 03.05.2019Universität Paderborn, Dissertation, 201

Biomass of invertebrate bycatch on the East- and West-Greenland shelf during Walther Herwig III cruise WH379

The study on invertebrate communities in East- and West-Greenland shelf waters was embedded in a fisheries survey carried out during the 379th expedition of the German fisheries vessel Walther Herwig III of the Thünen Institute of Sea Fisheries, Hamburg, Germany. The aim of the study was a coarse classification of the bycatch comprising macrobenthic organisms. On the one hand the marine ecosystem of this area provides food for commercially valuable fish stocks and plays, potentially an important role in the remineralisation of nutrients. On the other hand it experiences stress by traditional bottom trawling as well as anthropogenic and natural climate variability. As a consequence the study can provide a baseline to detect further changes in the composition of this component of a sub-arctic marine ecosystem

Sharing Means Caring? Hosts\u27 Price Reaction to Rating Visibility

We empirically investigate how hosts on Airbnb, a popular peer-to-peer website for fee-based sharing of under-utilized space, adjust their prices once their offering gets a visible star rating for the first time. We use data for over 14,000 offerings from Airbnb which we collected for New York City. Our findings indicate that hosts whose offerings achieve star rating visibility significantly increase their prices by an average of 2.69 € more than hosts with comparable offerings who do not experience this rating visibility during the time of observation. Out of all offerings who achieve rating visibility, we identify the upper quartile of hosts to be the main driver of this price increase, whereas the first 75% percent show only a marginal price reaction. These results can serve as a first step towards under-standing the motivation of people to provide assets to the sharing economy

A HOMEOWNER’S GUIDE TO AIRBNB: THEORY AND EMPIRICAL EVIDENCE FOR OPTIMAL PRICING CONDITIONAL ON ONLINE RATINGS

Optimal price setting in peer-to-peer markets featuring online ratings requires incorporating interactions between prices and ratings. Additionally, recent literature reports that online ratings in peer-to-peer markets tend to be inflated overall, undermining the reliability of online ratings as a quality signal. This study proposes a two-period model for optimal price setting that takes (potentially inflated) ratings into account. Our theoretical findings suggest that sellers in the medium-quality segment have an incentive to lower first-period prices to monetize on increased second-period ratings and that the possibility on monetizing on second-period ratings depends on the reliability of the rating system. Additionally, we find that total profits and prices increase with online ratings and additional quality signals. Empirically, conducting Difference-in-Difference regressions on a comprehensive panel data set from Airbnb, we can validate that price increases lead to lower ratings, and we find empirical support for the prediction that additional quality signals increase prices. Our work comes with substantial implications for sellers in peer-to-peer markets looking for an optimal price setting strategy. Moreover, we argue that our theoretical finding on the weights between online ratings and additional quality signals translates to conventional online markets