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How Do Platform Participants Respond to an Unfair Rating? An Analysis of a Ride-Sharing Platform Using a Quasi-Experiment

36 Pages Posted: 19 May 2017 Last revised: 17 Nov 2017

Anuj Kapoor

University of Utah

Catherine E. Tucker

Massachusetts Institute of Technology (MIT) - Management Science (MS)

Multiple version iconThere are 2 versions of this paper

Date Written: October 24, 2017

Abstract

Online rating systems can lead, on occasion, to reviews that are unfair or unrepresentative of the true quality provided. On the one hand, receiving an unfairly low rating once, might induce participants to exert more effort and receive a better rating the next time. On the other hand, it might dispirit participants and make them exert less effort. We use data from a ride-sharing platform in India where driver ratings were made particularly salient to the driver after each trip. Our data suggests that if a customer experiences a ride cancellation, they are more likely to unfairly blame the replacement driver. We use this as a exogenous source of unfair negative ratings for the driver. We show that drivers are more likely to respond negatively to a bad rating and receive subsequently bad ratings if they were blameless for the previous negative rating. This effect is larger in contexts where there is a higher potential for an emotional response and when there is a greater need for driver skill in the subsequent ride. These unfair ratings can lead drivers to leave the platform, suggesting a broader negative effect of unfair negative ratings on platform participation.

Keywords: The Sharing Economy, User Generated Content, Ratings

JEL Classification: L86, M37

Suggested Citation

Kapoor, Anuj and Tucker, Catherine E., How Do Platform Participants Respond to an Unfair Rating? An Analysis of a Ride-Sharing Platform Using a Quasi-Experiment (October 24, 2017). Available at SSRN: https://ssrn.com/abstract=2970772 or http://dx.doi.org/10.2139/ssrn.2970772

Anuj Kapoor

University of Utah ( email )

1645 E. Campus Center
Salt Lake City, UT 84112
United States

Catherine Tucker (Contact Author)

Massachusetts Institute of Technology (MIT) - Management Science (MS) ( email )

100 Main St
E62-536
Cambridge, MA 02142
United States

HOME PAGE: http://cetucker.scripts.mit.edu

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