Indirect Reciprocity in Online Social Networks - A Longitudinal Analysis of Individual Contributions and Peer Enforcement in a Peer-to-Peer Music Sharing Network

41 Pages Posted: 16 Jan 2009 Last revised: 25 Feb 2009

See all articles by Bin Gu

Bin Gu

Boston University - Questrom School of Business

Yun Huang

Northwestern University

Wenjing Duan

George Washington University - School of Business

Andrew B. Whinston

University of Texas at Austin - Department of Information, Risk and Operations Management

Date Written: January 16, 2009

Abstract

Indirect reciprocity is an important factor that motivates individual contributions in social networks. However, prior studies of indirect reciprocity are often limited to a snapshot view of individual interactions in social environments. This paper analyzes indirect reciprocity from a dynamic perspective in the context of a peer-to-peer music sharing network. We have two main findings. First, we reveal that indirect reciprocity is a dynamic social force. An individual's likelihood of contribution changes with the social environment, particularly with others' contribution levels in the network. The individual increases her contribution probability when she observes an increase in the number of contributors while decreases her contribution probability when she observes an increase in the number of free riders. Second, we find that indirect reciprocity is a social norm that is voluntarily enforced by contributors in the network. They do so through the setting of servers to discriminate downloaders. When the number of free riders increases, a contributor is more likely to change the server settings to provide preferential services to other contributors and lesser services to free riders. Our results indicate that indirect reciprocity plays a key role in sustaining private contributions to social networks.

Keywords: indirect reciprocity, social norm, social enforcement, social networks, peer-to-peer networks, public goods, incentive provisions, music sharing

JEL Classification: C91, C92, D71, H41

Suggested Citation

Gu, Bin and Huang, Yun and Duan, Wenjing and Whinston, Andrew B., Indirect Reciprocity in Online Social Networks - A Longitudinal Analysis of Individual Contributions and Peer Enforcement in a Peer-to-Peer Music Sharing Network (January 16, 2009). McCombs Research Paper Series No. IROM-06-09, Available at SSRN: https://ssrn.com/abstract=1327759 or http://dx.doi.org/10.2139/ssrn.1327759

Bin Gu (Contact Author)

Boston University - Questrom School of Business ( email )

595 Commonwealth Avenue
Boston, MA MA 02215
United States

Yun Huang

Northwestern University ( email )

2145 Sheridan RD
TECH C210
Evanston, IL 60208
United States

Wenjing Duan

George Washington University - School of Business ( email )

2121 I Street NW
Washington, DC 20052
United States

Andrew B. Whinston

University of Texas at Austin - Department of Information, Risk and Operations Management ( email )

CBA 5.202
Austin, TX 78712
United States
512-471-8879 (Phone)

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