• Industrial Engineering and Management Systems
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• v.12 no.3
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• pp.264-273
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• 2013

Credit option is a policy that has been studied by many researchers in the area of supply chain management. This policy has been applied in practice to improve the profits of supply chain members. Usually, a credit option policy is proposed by the seller, and often under a symmetric information environment where members have complete information on each others' operations. In this paper, we investigate two scenarios: firstly, the seller offers a credit option to the buyer, and secondly, the buyer attempts to stretch the length of the credit period offered by the seller. The proposed model in both scenarios will be investigated under an asymmetric information structure where some information are private and are only known to the individual who has knowledge of this information. The interactions between buyer and seller will be modeled by non-cooperative Stackelberg games where the buyer and seller take turn as leader and follower. Among some of the numerical results obtained, the seller and buyer's profits obtained from symmetric information games are larger than those obtained from an asymmetric information game in both scenarios. Furthermore, both buyer and seller's profit in the second scenario are better than in the first scenario.

• Asia-Pacific Journal of Business
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• v.11 no.4
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• pp.21-36
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• 2020

Purpose - This study analyzes the effect of sellers' dishonesty on various market outcomes such as seller profit, buyer profit, and market welfare, through precisely measuring the level of sellers' information disclosure and its economic impacts. As an explicit observation of sellers' dishonesty is not easy in most other settings, this study is expected to suggest unique and meaningful implications on the effect of sellers' incomplete information disclosure to researchers, managers, and policy makers. Design/methodology/approach - In order to precisely measure the level of sellers' dishonesty under information asymmetry, this study analyzes the data from an incentive-based economic experiment using z-Tree software. This experimental method enables us to focus on the strategic interactions among participants, observe the integrity of seller's information disclosure, and reproduce real market situations. Findings - The analysis of sellers' dishonesty has provided the following important and counterintuitive findings about the reality of buyer-seller interactions under information asymmetry. First, sellers' lies do not affect seller profit even when they are very intensive. Second, sellers' dishonesty negatively affects buyer profit and the entire market welfare. Third, a seller's quality claim has a positive effect on the seller profit only when a seller is being honest. Research implications or Originality - This study analyzes sellers' dishonesty using incentive-based economic experiment using z-Tree software which provides a straightforward examination on dishonest behavior of sellers, that is not readily available with other types of observational or experimental data.

• The Journal of Economics, Marketing and Management
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• v.11 no.2
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• pp.23-32
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• 2023

Purpose: This study examines the effect of full information disclosure on seller profit when there exists information asymmetry between sellers and buyers, focusing on the risk averseness of buyers. By investigating the interaction between product quality and perceived risk through online sales data, we attempt to figure out the incentive structure of full information disclosure specifically when buyers are risk-averse, so that we can suggest more feasible information disclosure strategy to sellers. Research design, data and methodology: Our empirical model analyzes the sales data of collectible goods from a major online seller using Poisson regression. In our model, we have specifically considered risk-averseness of buyers by estimating the interaction effect between the product quality and perceived risk on seller profit, aiming for a more precise empirical analysis on sellers' incentive structure of full disclosure. Results: Our empirical analysis strongly supports the effect of interaction between product quality and perceived risk, showing that the incentive for full disclosure is much stronger when product quality is higher, and vice versa. Therefore, sellers are strongly encouraged to voluntarily reveal product weaknesses when their product quality is higher than average, while it is more profitable to hide any product defects when quality claim is lower than average. Conclusions: This study supports the related literature by confirming economic incentives for full disclosure, and also supplements and strengthens previous studies by presenting that the effect of interaction between product quality and perceived risk strongly affects seller profit. Our unique finding supports both mandatory disclosure and voluntary disclosure arguments and presents practical implications to marketing managers by suggesting that seller's incentive for revealing weaknesses depends on the level of seller's product quality.

• Journal of KIISE
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• v.42 no.10
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• pp.1286-1293
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• 2015

Most e-marketplaces build a reputation system that provides potential buyers with reputation scores of sellers in order for buyers to identify the sellers that are more reliable and trustworthy. The reputation scores are computed based on the aggregation of buyers' ratings. However, when these ratings are used to compute the reputation scores, the existing reputation systems do not make a distinction according to the following two criteria: the capability of the seller and the quality of an item. We claim that a reputation system needs to separate the two criteria in order to provide more precise information about the seller. In this paper, we propose a method to compute seller's reputation by separating the rating into the seller's score and the item's score. The proposed method computes the reputation of the seller's capability by using only the 'seller's score' and helps potential buyers to find reliable sellers who provide fast delivery and better service. In experiments, we propose a simulation strategy that reflects the real life of an E-marketplace and verify the effectiveness of our method by using the generated simulation data.

• Asia pacific journal of information systems
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• v.23 no.3
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• pp.105-129
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• 2013

This study draws important factors in electronic Word-of-Mouth (eWOM) and examines how these influence the building of customer loyalty. eWOM is viewed as social communication between customers and sellers, and thus the communicative action theory is applied. With the theory, we identify reviewer and seller as influential players on customers, and derive important factors such as correctness and veracity of reviews from the reviewers' action, and information compactness and adequacy from the seller's action. We propose these constructs as antecedents of customer loyalty and further hypothesize their curvilinear impacts as follows: the marginal impacts of veracity and correctness will decrease as veracity and correctness increase, and the marginal impacts of compactness and adequacy will increase as compactness and adequacy increase. The result indicates that only the seller's action has a curvilinear impact, whereas the reviewer has proportional positive impact on customer loyalty. This study indentifies important factors in eWOM from a critical social theory perspective and validates them using the positivistic approach. For practitioners, it discusses the important factors in eWOM with the identification of the individuals who are responsible for these factors.

• KSII Transactions on Internet and Information Systems (TIIS)
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• v.5 no.8
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• pp.1472-1491
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• 2011

As used product transactions are currently on the rise, the demand for transactions of secondhand digital content will grow in the future; thus, learning to make secure transactions while avoiding cyber attacks becomes an important issue. In this paper, we combine the new buyer's secret key, the new buyer's watermark to embed in resold digital content, and the reseller's encrypted watermark, which can prove legal ownership of the reseller. Using the privacy homomorphism property of RSA and exponential calculus, the original seller of digital content can verify the legality of the reseller and the new buyer. We also reduced the load of encryption/decryption digital content using a partial encryption/decryption algorithm to make our protocol more efficient and practical. In the proposed protocol, the seller is not able to conduct piracy and easily frame any other innocent secondhand buyer when a case of piracy is found. In fact, piracy can be clearly traced using the privacy homomorphism property of RSA and the embedded watermark mechanism. Further, in the proposed protocol, the seller himself can trace the piracy using exponential calculus. Since it is unnecessary to trust third party participation, the conspiracy problem is resolved and the new buyer is not required to participate in the dispute. Moreover, the seller, reseller and new buyer can simultaneously benefit from the secondhand transaction.

• Information Systems Review
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• v.25 no.2
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• pp.103-123
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• 2023

One of the valid perspectives in the e-commerce platform literature is the seller signaling strategy in the information asymmetry situation. In this study, a research model was constructed based on signaling theory and shopping goal theory to systematically explore the effects of a seller's signaling strategy on consumer decision-making. Specifically, the study examined whether the signaling effects (i.e., reputation, electronic word-of-mouth, price) provided by the seller differed based on consumers' shopping goals. For the empirical analysis, the Gaussian Copula method was employed, utilizing 26,246 data collected from Amazon, a leading e-commerce platform. The analysis revealed that the signals provided by the seller positively impacted sales, and this effect was moderated by consumers' shopping goals. Drawing on shopping goal theory, this study contributes to signaling theory and e-commerce literature by discovering differences in the effectiveness of a seller's signaling strategy based on the keywords input by consumers.

• The Journal of Information Systems
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• v.20 no.4
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• pp.233-254
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• 2011

Although e-commerce is growing fast, e-commerce consumers are still under higher risk and uncertainty in the comparison of the traditional commerce's. Consumer review boards of online shopping malls are good measures to help buyer's decision making, and should be managed effectively by sellers. We formulate the research model on consumer trust formation on seller managed web review boards on the background of previous literatures on e-WOM and trust. Our data analysis with 368 samples shows seller's reputation, e-service quality, perceived reviewer's benevolence and ability have significant positive effect on the trustworthiness of the board. Product involvement shows weak negative moderation effect on the relationship between perceived reviewer's benevolence and trustworthiness of review boards.

• International Commerce and Information Review
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• v.13 no.3
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• pp.459-485
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• 2011

This paper examines the seller's obligation to deliver documents conforming to the terms of the sales contract as set forth in articles 30 and 34 of the CISG. Article 30 obliges the seller to band over documents relating to the goods. This obligation to band over documents is further elaborated in article 34. According to article 34, the documents must be tendered at the time and place, and in the form, required by the contract. If the seller has delivered non-conforming documents before the agreed time, he has the right to remedy the defects if this would not cause the buyer unreasonable inconvenience or expense. However, the buyer can claim any damages suffered despite the seller's remedy. Specific emphasis is placed on the interplay between the CISG and Incoterms. Incoterms contain detailed rules governing the obligations of the seller to provide for documents. Incoterms constitute international trade usage under articles 9(1) and 9(2) CISG and supplement construction of CISG with UCP under L/C transaction. In the event of failure by seller to deliver the necessary documents, the buyer has certain remedies available, such as the right to claim damages, the right to demand specific performance, and the right to repair. Furthermore, the failure to deliver the required documents under contract constitute a fundamental breach of the underlying sales contract as defined by article 25 of the CISG by the seller, and thereby enable the buyer to avoid the contract entirely article 49. However, it is stressed that since one of the main principles of the CISG is the preservation of the contract, the avoidance of the contract should remain a remedy of last resort.

• Journal of Digital Convergence
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• v.8 no.2
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• pp.147-160
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• 2010

Internet shopping mall business has taken its place as a major form of e-commerce and is evolving constantly. At the same time, disputes of various kinds are also arising in proportion to the evolution. A typical example is when a consumer purchased a product from an internet shopping mall and the seller wants to cancel or withdraw the sales contract saying that he miswrote the price or other important information when posting the product on the internet. It's about the error on the seller's part. Civil Law Chapter 109, legal principles on errors, appears to assume the case of natural declaration of intention. It was observed that legal principles on errors defined by the Civil Law are also applied in internet shopping malls, where declaration of intention is made electronically. In transactions involving internet shopping malls, where the seller's indication and advertisement constitutes an inducement to offer, the seller may cancel a contract concluded by the consumer's offer and the seller's acceptance if the seller finds errors on his part, and adequacy of the cancellation should be judged depending on specific cases. That is, the judgment of the important ground that comprises prerequisites for cancellation and presence of negligence may depend on how much difference there is between the normal price and the posted price on a specific case. Also, considering the cases where negligence was not perceived on the seller's miswriting of the price, the seller may cancel the transaction in a similar situation.