Design of a Reputation System Based on Dynamic Coalition Formation

Reputation systems bear some challenging problems where buyers have different subjectivity in evaluating their experience with sellers and they may not have incentives to share their experience. In this paper, we propose a novel reputation system based on dynamic coalition formation where buyers with similar subjectivity and rich experience will be awarded virtual credits for helping others find trustworthy sellers to successfully conduct business. Our theoretical analysis confirms that the coalitions formed in this way are stable.