Cyber “Lemons” Problem and Quality-Intermediary Based on Trust in the E-Market-A Case Study from AUCNET (Japan) -
The web makes it easier for buyers to purchase products from distant seller. But, the inability of the buyer to examine the merchandise brings on the cyber “lemons” problem resulting form the asymmetry of information. However, it’s a pity that we merely idolize the convenient such as the products customization or personalization from the technology of the Internet and ignore these problems. Based on the lemon principle put forward by American economist George Akerlof, who is one of Nobel economics prize laureates in 2001, the paper analyzes the inherent mechanism in eliminating the cyber lemons. For providing empirical evidence, the paper discusses a case from AUCNET (Japan). The paper concludes that the quality-intermediaries as a trusted third party in electronic commerce may play an important role in eliminating the cyber “lemon”. The Internet maybe become a fertile field for quality-intermediaries’. A successful intermediary in the e-commerce market is the establishment of trust for market participants. That Japanese accept the online used-car market (AUCNET) completely lie in the trust for the web AUCNET. The trust as the firm specific resource can form and consolidate competitive edge. At last, the paper puts forward individual view about higher price and quality distribution of the used car in AUCNET.