An Empirical Research on Taobao: Seller Reputation´s Impact on Auction Price Premium

Online auction is developing with a high speed in China. Because of the uncertainty and risk of online transactions, seller reputation is becoming an important factor that influences buyer´s auction decision. The impact of seller reputation on auction price is discussed in many literatures, and gets well supported in some of them. As most researches are focusing on US market, especially eBay, it is necessary to make analysis on China online auction market, like Taobao for representative. This paper first reviews previous literatures on trust, reputation and auction price, then makes empirical study with data collected from Taobao, and analyzes the impact of seller reputation on auction price.