Information value and externalities in reputation building

B-Tier
Journal: International Journal of Industrial Organization
Year: 2011
Volume: 29
Issue: 1
Pages: 23-33

Score contribution per author:

0.670 = (α=2.01 / 3 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

In sequential equilibrium theory, reputation building is independent of whether the reputation builder is matched with one long-run partner or a series of short-run "strangers". We observe, however, that reputation builders are significantly more challenged by long-run players in both laboratory chain store and buyer-seller games. Reputation builder behavior is more predictable than implied by equilibrium, and so reputation information has more economic value than implied by equilibrium. For short-run players, this reputation information value is an externality. For long-run players, the value of the information is internalized and so they have greater incentive to challenge the reputation builder.

Technical Details

RePEc Handle
repec:eee:indorg:v:29:y:2011:i:1:p:23-33
Journal Field
Industrial Organization
Author Count
3
Added to Database
2026-01-24