He shows that in closed systems people who focus on the relationships of the members and who do not trust work well whereas in open systems where it is more important to find many trustworthy people, it was better to assume people were trustworthy at the beginning.

He is a social psychologists and talked about some experiments he did where he found that people who trusted people more generally did better in his open market simulations. He found that people who trusted people more tended to be better at quickly discerning the trustworthiness of the partner. He shows that in closed systems people who focus on the relationships of the members and who do not trust work well whereas in open systems where it is more important to find many trustworthy people, it was better to assume people were trustworthy at the beginning.

Anyway, I don't do his work justice with this small comment. His most recent paper is not yet available in Japanese, but his early work on trust is also very interesting and is available on his site.

Here is his web page.

http://lynx.let.hokudai.ac.jp/members/yamagishi/english.htm

3 Comments

Toshio Yamagishi
Dear Joi, I have sent the paper out for review--it will take some time for the paper to get published. Yes, I'm happy that it is widely distributed. You may do whatever you want to do with the paper. Best regards, Toshio
Improving the Lemons Market with a Reputation System: An Experimental Study of Internet Auctioning by Toshio Yamagishi

A message I posted to decentralization, a Yahoo Groups ML.

There is a great deal of research being done by a Toshio Yamagishi
at Hokkaido University. His web page is here
http://lynx.let.hokudai.ac.jp/members/yamagishi/english.htm

His most recent paper, which is relevant to your discussion is not
yet on his site, but I can get it for anyone who is interested. He
is a social psychologist and does a study of reputation systems. He
uses an online open market where people create sell and buy things.
They can lie about the quality of what they sell or can tell the
truth. He test four reputation models. Completely identified where
you can't change your nym. Completely anonymous. Positive reputation
tracking only where you can change your nym and negative reputation
tracking with changing nyms.

He finds that complete identity is the highest quality of exchange,
but this is obviously only possible in a closed community and not
something I believe is feasible or desireable on the Net. Completely
anonymous is obviously bad. The two interesting results were that
negative tracking started out with better quality and quickly
degenerated while tracking positive reputation started out rather
low, but grew until it was almost a high as a closed system with
full identity.

Quality here is defined as the likelyhood of buying something of
lower quality and marked, or of someone lying. What he shows is that
onces people develop positive reputations, they continue to try to
keep them while negative reputation tracking encourages reseting
your nym. Negative reputation SOUNDS good so people try not to get
it at the beginning, but what really affects our behavior long term
is positive feedback.

His research is very thorough using a variety of time-lines and
techniques in a laboratory with real people an a mocked up B2B
exchange.

BTW, the URL for the Decentralization mailing list about the "the end-to-end principle" is here http://groups.yahoo.com/group/decentralization/

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Trust and trustworthiness online is a subject of some concern to those of us who live the life of telework and dream of internetworking ad-hoc business-webs of entrepreneurial free-agent nanocorps. The highest Read More

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