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Understanding the Platform Economy: Signals, Trust, and Social Interaction

Two-sided markets are gaining increasing importance. Examples include accommodation and car sharing, resale, shared mobility, crowd work, and many more. As these businesses rely on transactions among users, central aspects to virtually all platforms are the creation and maintenance of trust. While research has considered effects of trust-building on diverse platforms in isolation, the overall platform landscape has received much less attention. However, cross-platform comparison is important since platforms vary in their degree of social interaction, which, as we demonstrate in this paper, determines the adequacy and use of different trust mechanisms. Based on actual market data, we examine the mechanisms platforms employ and how frequent users rely on them. We contrast this view against survey data on users’ perceptions of the context-specific importance of these trust-building tools. Our findings provide robust evidence for our reasoning on the relation between platforms’ degree of social interaction and the associated expressive trust cues. Code and Data: http://bit.ly/UnderstandingPlatformEconomy