Uncertain Values, Flea Markets, and Online Sales: How to Be Sure of Quality?

This paper considers reputation from the point of view of the theory of repeated games. It is the strategic dimension of reputation that distinguishes it from other notions, such as celebrity or fame. Game-theoretic interpretations of reputation in repeated games see it as a way of reducing uncertainty about the possible future actions of the players. A player may give up an immediate gain if he or she is able to realize the potential benefits of a long term interaction. However, reputation doesn’t always triggers cooperation and trust as non rival goods: when uncertainty is both alter- and egocentric, it is managed through the allocation of positional status, in which the cumulative advantage of one of the player is amplified and creates a fundamental asymmetry in the interaction.