Relating Reputation and Money in On-line Markets

Abstract

Reputation in on-line economic systems is typically quantified using counters that specify positive and negative feedback from past transactions and/or some form of transaction network analysis that aims to quantify the likelihood that a network user will commit a fraudulent transaction. These approaches can be deceiving to honest users from numerous perspectives. We take a radically different approach with a goal to guarantee to a buyer that a seller cannot disappear from the system with profit following a set of transactions that total a certain monetary limit. Even in the case of stolen identity, an adversary cannot produce illegal profit unless a buyer decides to pay over the suggested sales limit.