Financial Value of Reputation: Evidence from the Ebay Auctions of Gmail Invitations

35 Pages Posted: 29 Sep 2011

See all articles by Qin Lei

Qin Lei

University of Michigan at Ann Arbor

Multiple version iconThere are 2 versions of this paper

Date Written: September 2011

Abstract

In this article, I utilize a unique collection of auctions on eBay to study the influence of seller reputation on auction outcomes. In a market of homogeneous goods with non‐enforceable contracts, I find that sellers who improve their reputation by one quintile from the lowest, experience a 6.2% higher probability of sale and a 6.1% hike in valuation after adjusting for truncation bias from failed auctions and explicitly controlling for unobservable seller heterogeneity. This study also shows that in addition to a dimension of reputation universal across different product markets, the product‐specific dimension of reputation significantly affects the auction outcomes.

Suggested Citation

Lei, Qin, Financial Value of Reputation: Evidence from the Ebay Auctions of Gmail Invitations (September 2011). The Journal of Industrial Economics, Vol. 59, Issue 3, pp. 422-456, 2011. Available at SSRN: https://ssrn.com/abstract=1935209 or http://dx.doi.org/10.1111/j.1467-6451.2011.00457.x

Qin Lei (Contact Author)

University of Michigan at Ann Arbor ( email )

Ross School of Business
701 Tappan Street
Ann Arbor, MI 48109-1234
United States

HOME PAGE: http://leiq.bus.umich.edu

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