The Dynamics of Seller Reputation : Evidence from eBay

  title={The Dynamics of Seller Reputation : Evidence from eBay},
  author={L{\'u}ıs A. Cabral},
We construct a panel of eBay seller histories and examine the importance of eBay’s reputation mechanism. We find that, when a seller first receives negative feedback, his weekly sales rate drops from a positive 7% to a negative 7%; subsequent negative feedback ratings arrive 25% more rapidly than the first one and don’t have nearly as much impact as the first one. We also find that a seller is more likely to exit the lower his reputation is; and that, just before exiting, sellers receive more… CONTINUE READING