A Discussion of 'Importance of Past Performance: Empirical Evidence on Quality of E-Service Providers'
Posted: 14 May 2008
Date Written: 2008
Banker and Hwang (2007) present a novel data set that combines 15 signals of reputation for an accounting service-provider context with the outcomes from 1,444 bidders on 221 accounting-based project auctions. At a conceptual level, Banker and Hwang (2007) add to prior evidence that higher seller reputation increases the likelihood of future sales. At an operational level, BH uses a service-provider context and three main proxies for service-provider reputation (feedback, self-selection, and experience). In this discussion, I consider the Banker and Hwang (2007) results in light of alternative explanations for their hypothesized results, most of which could not easily be addressed by the authors because of data constraints. I also discuss the usefulness of data sources such as those publicly available from electronic online auctions to help us understand better the answers to research questions about the measurement of a service-provider's performance. Finally, I evaluate the contribution of the Banker and Hwang study using the criteria of "legitimate, consequential, belief revision" first proposed in Maines, Salamon and Sprinkle (2006), and consider related opportunities for future research.
Keywords: Non-financial performance measures, leading indicators, e-service providers
JEL Classification: L84, M30, M40
Suggested Citation: Suggested Citation