Escrow Services Research Articles

Building Trust in Collaborative Consumption Services Facilitated through an Online Platform

Many acts of collaborative consumption are facilitated via customer-to-customer (C2C) online based sharing networks or marketplaces, in which participants rent, lend, trade, barter, and swap goods, services, transportation solutions, space, or money. In this paper a model on trust building measures and the hierarchical construct of trust in a sharing option facilitated through an online platform is developed. To test the model, two empirical studies are conducted, first, a survey among users of the online sharing marketplace Airbnb (N=232), and second, an experiment among non-users of a fictitious online sharing platform ShareNow.com (N=462). Empirical results confirm the hierarchical nature of the two-fold trust construct. A causal relationship between the level of trust in the provider of a sharing platform and the level of trust in peers one is sharing with could be confirmed. Furthermore, results reveal four measures to statistical significantly influence the two-fold trust construct. This applies to: Much effort put in development of website, a strong statement concerning privacy policy, third-party certification, and reliable escrow services.

Optimized combined-clustering methods for finding replicated criminal websites

To be successful, cybercriminals must figure out how to scale their scams. They duplicate content on new websites, often staying one step ahead of defenders that shut down past schemes. For some scams, such as phishing and counterfeit goods shops, the duplicated content remains nearly identical. In others, such as advanced-fee fraud and online Ponzi schemes, the criminal must alter content so that it appears different in order to evade detection by victims and law enforcement. Nevertheless, similarities often remain, in terms of the website structure or content, since making truly unique copies does not scale well. In this paper, we present a novel optimized combined clustering method that links together replicated scam websites, even when the criminal has taken steps to hide connections. We present automated methods to extract key website features, including rendered text, HTML structure, file structure, and screenshots. We describe a process to automatically identify the best combination of such attributes to most accurately cluster similar websites together. To demonstrate the method’s applicability to cybercrime, we evaluate its performance against two collected datasets of scam websites: fake escrow services and high-yield investment programs (HYIPs). We show that our method more accurately groups similar websites together than those existing general-purpose consensus clustering methods.

An economic model of optimal fraud control and the aftermarket for security services in online marketplaces

The anonymity of online markets allows traders to easily behave opportunistically. Online marketplaces can lower the uncertainty of participants’ identities by adopting preventative controls such as privacy disclosure rules. However, the use of severe privacy controls to engender risk-free environments might sacrifice not only the size of transactions in the marketplace but also the demand for optional security services like escrow services, which constitute a very sizable revenue source for the marketplace services provider. In this vein, we investigate the probability that an integrated online marketplace (IOM) with security services strategically adjusts privacy controls to incentivize traders to self-select both basic transactions and optional security services. Our results show that an integrated marketplace increases the probability of allowing more fraud than is socially optimal by lowering privacy controls. Market risk can be viewed as an asset for an integrated marketplace rather than a liability that inflicts transaction costs on worried traders. Our study argues that marketplaces may differ in terms of their fraud control from what is socially optimal, according to their revenue structures so that the control of online fraud needs to be regulated from the social perspective. However, under certain conditions, integration of this aftermarket will not harm traders or the social welfare.

The Effectiveness of the Escrow Model: An Experimental Framework for Dynamic Online Environments

This article investigates the mechanism of an online escrow service (OES) in online consumer-to-consumer (C2C) auctions. We develop a discrete-event driven simulation model for the dynamics of an OES adoption in electronic markets that involves four types of agents: the strategic trader, the moral trader, the OES provider, and the law-enforcement agent. By applying the Monte Carlo method in computer-based simulations, we demonstrate that the OES business model can effectively block fraud attempts and promote security in online C2C auction markets. However, our findings reveal that the prevailing OES fee rates are not necessarily set at the profit maximization level. Meanwhile, the simulation results show that the legal mechanisms in electronic markets directly impact the profit of escrow services.

A Feasible System of Infill Supply for Urban Housing in China

In recent years, Chinese house production has reached the vast scale of ten million units each year, many of which are being commercialized. China has gradually developed a unique form of two-stage unit realization where the unit owner, the long-term lessee, endeavors to procure fitting out. This causes various risks for the stakeholders, such as the authority, the developer, the infill supplier and especially the owner. The authors have investigated the state-of-the-art of the fitting out practice for multi-family housing in Chinese metropolises, and structured the risks imposed on the stakeholders. Having found a similarity in the supply pattern with single-family detached housing rather than multi-family housing in other countries, a viable means to avoid the risks was sought. Proposed in this paper is a system which combines incremental inspection with escrow service, a type which has already been introduced to the custom-built single family housing market in Japan.

Determinants of escrow service adoption in consumer-to-consumer online auction market: An experimental study

Risk relief services (RRSs), as complementary to online trust promoting services, are becoming versatile options for risk reduction in online consumer-to-consumer auctions. In this paper, we identify factors that affect the behavior of buyers in an online auction market who had to either adopt or not adopt online escrow services (OES). An experimental C2C auction system with embedded decision support features was used to collect data. Results show that market factors, such as fraud rate, product price, and seller's reputation are important in determining buyers' OES adoption. This study also finds that sellers' reputation has a significant effect on buyer's risk perception, which influences his OES adoption decision. Furthermore, the buyers' OES adoption decisions were found to be congruent with the implied recommendations that were based on expected utility calculations.

A Descriptive Content Analysis of Trust-Building Measures in B2B Electronic Marketplaces

Because business-to-business (B2B) electronic marketplaces (e-marketplaces) facilitate transactions between buyers and sellers, they strive to foster a trustworthy trading environment with a variety of trust-building measures. However, little research has been undertaken to explore trust-building measures used in B2B e-marketplaces, or to determine to what extent these measures are applied in B2B e-marketplaces and how they are applied. Based on reviews of the scholarly, trade, and professional literature on trust in electronic commerce, we identified 11 trustbuilding measures used to create trust in B2B e-marketplaces. Zucker’s trust production theory [1986] was applied to understand how these trust-building measures will enhance participants’ trust in buyers and sellers in B2B e-marketplaces or in B2B e-marketplace providers. A descriptive content analysis of 100 B2B e-marketplaces was conducted to survey the current usage of the 11 trust-building measures. Many of the trust-building measures were found to be widely used in the B2B e-marketplaces. However, although they were proven to be effective in building trust-related beliefs in online business environments, several institutional-based trustbuilding measures, such as escrow services, insurance and third-party assurance seals, are not widely used in B2B e-marketplaces.

Non-binding sequential exchange between discounting agents

When exchange is sequential, and no binding agreements can be written, the agent acting first is exposed to the possibility that even if he honors the agreement his trading partner might not. Repeated interaction of this nature is modeled. Exchange will successfully occur when there are ample gains from trade for the second agent, implying that the first agent may be better off with less bargaining power. Thus, the first agent may want to bargain at less than his full ability in order to ensure that an otherwise unsuccessful transaction will successfully occur. Additionally, if the first agent can facilitate exchange by hiring an escrow service, he will do so when his bargaining advantage is sufficiently large.

Hope or Hype: On the Viability of Escrow Services as Trusted Third Parties in Online Auction Environments

Internet fraud has been on the rise in online consumer-to-consumer (C2C) auction markets, posing serious challenges to people's trust in electronic markets. Among various remedies to promote trust and reduce trader's risk, online escrow service has been proposed as a trusted third party to protect online transactions from Internet fraud. However, whether an escrow service constitutes a viable business model for a trusted third party to effectively block Internet fraud remains an open question. This research proposes a dynamic game model for online traders and a profit maximization model for the escrow service provider. Through the investigation of the optimal strategies of online traders, we explore the relationships among traders' decision making, escrow service fee rates, and adoption rates. We reveal the demand for escrow services and establish the optimal pricing rule for the escrow service provider. A numerical study based on the theoretical analysis is conducted to provide detailed guidelines of the model application for an escrow service provider and to explore if the escrow service is a viable business model in C2C auction markets.

Building Effective Online Marketplaces with Institution-Based Trust

Institution-based trust is a buyer’s perception that effective third-party institutional mechanisms are in place to facilitate transaction success. This paper integrates sociological and economic theories about institution-based trust to propose that the perceived effectiveness of three IT-enabled institutional mechanisms–specifically feedback mechanisms, third-party escrow services, and credit card guarantees–engender buyer trust in the community of online auction sellers. Trust in the marketplace intermediary that provides the overarching institutional context also builds buyer’s trust in the community of sellers. In addition, buyers’ trust in the community of sellers (as a group) facilitates online transactions by reducing perceived risk. Data collected from 274 buyers in Amazon’s online auction marketplace provide support for the proposed structural model. Longitudinal data collected a year later show that transaction intentions are correlated with actual and self-reported buyer behavior. The study shows that the perceived effectiveness of institutional mechanisms encompasses both “weak” (market-driven) and “strong” (legally binding) mechanisms. These mechanisms engender trust, not only in a few reputable sellers, but also in the entire community of sellers, which contributes to an effective online marketplace. The results thus help explain why, despite the inherent uncertainty that arises when buyers and sellers are separated in time and in space, online marketplaces are proliferating. Implications for theory are discussed, and suggestions for future research on improving IT-enabled trust-building mechanisms are suggested.

Technology Licensing Exchanges

People who deal in intellectual property have long been using the Internet as an adjunct to their business and recently they have been adopting new models of web-based or web-supplemented IP exchange services. Some inventors have set up intellectual property auctions on the eBay model. Below is a selected list of web sites that offer patent and intellectual property exchanges. Most offer a database of inventions that technology licensing partners can browse by category or search by keyword. Fees and arrangements vary, including non-profit and commercial, free and fee-based. Many sites contain general information on inventions and patents, and link to other useful sites. The world of invention ranges from stolid corporate and university-based R&D departments to quirky individual inventors, and so do the patent exchanges. Two useful on-line articles on intellectual property exchanges in general (on the Patent Auction.com site (http:// www.Patentauctian.com)) are Marketplace of Ideas: Selling Patents Online, by Paul Jacobs, Los Angeles Times, Oct. 29, 1999 (http://www.patentauction. com/news/ la times.htm), and And now, intellectual capital can be traded on the net, by Akash Joshi, Financial Express, Mar. 11, 1999) (http: //www.patentauction. com/news/ India express.htm). Norman Bauman is a New York City-based science journalist. He has been writing about science and technology, including biotechnology patents, for over 20 years. http://www.nasw.org/users/nbauman yet2.com (http.//www.yet2.com) Cambridge, MA, USA (617) 557-3800 Manchester, England 44 (1928) 58 3500 Tokyo, Japan 81(28)6677924 (support(i4et2. come Cross-industry. Claims that 25 percent of all worldwide R&D is posted on yet2.com. Over 400 companies and 37 major corporate and consortia sponsors, including Boeing, P&G, 3M, British Telecom, Toyota, EPRI, and Sandia list their technologies exclusively. Anyone can post technologies for a posting fee of $500 for up to five technologies, or $5,000 a year for unlimited membership. Free registration allows user to search by keyword or browse by category to view available technology by one-line general description. More detailed description available with 24-hour membership for $25, or one-year subscription for $500 ( 1-9 users). Transaction fee for successful sale or licensing is $5,000 minimum, or 10 percent to $50,000 maximum. Intellectual Property Technology Exchange, Inc. (TechEx) (http://techex. com) 25 Science Park, Box 20 New Haven, CT 06511 (203) 865-5524 (fax) Jon Garen Vice President (203)865-5520 (on.garen@techex.com) Jerry Williamson President and CEO (203)865-5522 (jerry.williamson@techex.com) Specializes in early-stage biomedical and life sciences, from basic research to issued patents. Agriculture, chemical, diagnostics, genomics, targets and screens, therapeutics, and medical devices. Over 3,000 licensing opportunities available. 250 university/government and 500 corporate participating organizations (founded by Yale U.). Members-only system restricted to approved users, who are legitimate technology providers or developers (no brokers). Search for categories by keyword. Automatic email notification based on keywords. No charges at this time, and currently not transaction-based. The Patent & License Exchange, Inc. (http: //Pl-x. com) 117 East Colorado Boulevard, Suite 200 Pasadena, CA 91105 (info@pl-x.com) (626)405-0690 (626) 405-0638 (fax) All industries, including information, health, materials, automotive, transportation, materials handling, and other business processes. Qualifies participants for experience and standing. Over 170 subscribers who can buy and sell technology. Individual inventors are encouraged to use agents. Provides a financial market approach for licensing intellectual property. Uses proprietary algorithms to calculate current value, price and financial risk. Provides escrow services, seller and buyer insurance, neutral contract documents. …

Handling hot spot data in DB-sharing systems

On-line transaction systems with high performance demands need a variety of concurrency control methods used for synchronizing data access of even a single transaction. Simple protocols based on strict two-phase locking would not meet their performance goals. This is particularly true for usage patterns of special data elements known as “hot spots”. In this paper, we review various solutions for concurrency control on aggregate data, where the operations to be synchronized commute—at least for certain value ranges. In particular, the escrow mechanism introduced for centralized DBMS is discussed and extended. Our investigations focus on the escrow mechanism for a data sharing environment where transactions running on multiple, independent processors must be efficiently synchronized without sacrificing their serializability. First of all, we propose the use of global escrow services, which may be called asynchronously. Such an optimistic attitude seems to be appropriate, since rejections of escrow operations typically are rare events. The performance of the proposed scheme may be further improved be refining it to a hierarchical escrow scheme with a global escrow and distributed local escrows. Both approaches may be favorably integrated either in a centralized locking scheme or in a primary copy authority scheme for DB-sharing.