Affiliation:
1. University of Warwick and Tel Aviv University, Israel
2. University of Warwick and CEPR, UK
3. University of Warwick, UK
Abstract
Abstract
We propose a model of product reviews in which some are genuine and some are fake in order to shed light on the value of information provided on platforms like TripAdvisor, Yelp, etc. In every period, a review is posted which is either genuine or fake. We characterise the equilibrium of the dynamic model and prove that it is unique. In equilibrium, valuable learning takes place in every period. Fake reviews, however, do slow down the learning process. It is established that any attempt by the platform to manipulate the reviews is counterproductive.
Publisher
Oxford University Press (OUP)
Subject
Economics and Econometrics
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