Advances in Management and Applied Economics

The Effect of Dishonest Sellers on E-commerce: An Agent-Based Modeling Approach

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  • Abstract

     

    This paper studies dishonest sellers in the e-commerce market, specifically their impact on the market under different conditions. We consider the role of consumers’ social and individual learning and social network branches on the market. We rely on a quality uncertainty market model (Izquierdo et al., 2007) and a trust game model (Wierzbicki et al., 2014) to establish an agent-based model. Our approach considers the proportion of honest and dishonest sellers, the reputation of sellers, and the expectation of quality among consumers after purchasing the goods. The results of the study reveal that when dishonest sellers appear in a market with a high degree of quality uncertainty, there is a negative impact on the market, including a decline in consumer expected quality of products in the market, a decrease in commodity transaction volume and market price, and a decrease in seller income. The impact is more pronounced in markets with a higher proportion of dishonest sellers.

     

    JEL classification numbers: C15, C63, D21, B82, B83.

    Keywords: Agent-Based modeling, E-commerce market, Dishonest sellers, Trust game, Reputation of sellers.