A Trust-Based Incentive Mechanism for E-Marketplaces

In the context of electronic commerce, when modeling the trustworthiness of selling agent relies (in part) on propagating ratings provided by buying agents that have personal experience with the seller, the problem of unfair ratings arises. Extreme diversity of open and dynamic electronic marketplaces causes difficulties in handling unfair ratings in trust management systems. To ease this problem, we propose a novel trust-based incentive mechanism for eliciting fair ratings of sellers from buyers. In our mechanism, buyers model other buyers, using an approach that combines both private and public reputation values. In addition, however, sellers model the reputation of buyers. Reputable buyers provide fair ratings of sellers, and are likely considered trustworthy by many other buyers. In marketplaces operating with our mechanism, sellers will offer more attractive products to satisfy reputable buyers, in order to build their reputation. In consequence, our mechanism creates incentives for buyers to provide fair ratings of sellers, leading to more effective e-marketplaces where honest buyers and sellers can gain more profit.