Ke Rong, Di Zhou*, Xinwei Shi, Wei Huang

Production and Operations Management 2022,31(3):984-1005.,

Recommend Reason

Real social information is believed to cause a trust–privacy paradox in e-commerce platforms, with the degree of information disclosure affecting platform performance. This paper first uses a large-scale online experiment to analyze the privacy paradox or the privacy–trust–behavioral impact, and we find that social information could play a positive role in e-commerce platforms if it is fully disclosed. The first contribution of this study is that we find real social relationships between sellers and buyers can work to reduce the information asymmetry in the e-commerce platforms. Another contribution of our research is that we demonstrate that different levels of social information disclosure will have different effects on online trading in the e-commerce platforms. The results of this study would encourage the cooperation of social platforms and trading platforms to achieve better online trading performance.

About the Author

Ke Rong, Institute of Economics, School of Social Sciences, Tsinghua University

Di Zhou*, School of Economics and Management, Tongji University

Xinwei Shi, College of Business Administration, Capital University of Economics and Business

Wei Huang, Zhuan Spirit Holdings Limited

Keywords

Social information disclosure; friends in common; e-commerce platform ecosystem; trust-privacy paradox; online experiment

Brief Introduction

In this paper, we split the mixed influence into the direct trust mechanism and the indirect privacy mechanism, studying each in the context of partial and full social information disclosure, respectively. Using unique data from an 80-day large-scale online experiment conducted in an e-commerce platform in China, we show that a partial social information disclosure could reduce the conversion rate, while a full social information disclosure could promote both the conversion and sales rates of the e-commerce platform through a trust mechanism. Moreover, social information disclosure would reduce the sales rate and promote the conversion rate through a privacy mechanism. However, even though the degree of privacy could enhance the privacy mechanism, this mechanism is still much weaker than a trust mechanism. Overall, social information could play a positive role in e-commerce platforms if it is fully disclosed. This paper encourages cooperation between social media platforms and e-commerce platforms by introducing a real social relationship into the online trading market.

Link https://doi.org/10.1111/poms.13591