Research on Chinese C2C E-Business Institutional Trust Mechanism: Case Study on Taobao and Ebay(cn)

E-business developed rapidly in recent years in China, especially C2C online auction. But trust building is also a main problem faced with C2C auction sites. In this paper we focus on the institutional trust mechanism of C2C online auction. By case study on two main auction sites, eBay and Taobao, which share most of the market, we investigated the institutional trust mechanism of them from four aspects: rules and policy, registration and authorization, payment and escrow service, feedback systems. Both of them make great efforts to win trust from users and prevent fraud. However, there are also problems with these mechanisms. Based on comparison, a few problems are discussed and suggestions are proposed.