In this book, Toshio Yamagishi, a distinguished professor of social psychology, extends his theory of trust to the Internet society.
He and his associates have conducted a set of experiments and examined how trust and reputation function on the Internet auctions.
The Internet is an open and anonymous society, which makes it difficult to form closed relationships and reduce transaction costs. On the other hand, the Internet provides more potential partners and thus reduces opportunity costs. In this setting, one needs to tell whether his/her trading partner is worth trusting.
The authors have found reputation worked well in some types of auctions and concluded that a meta-evaluation system (such as Amazon's "helpful customer reviews") was necessary to give people an appropriate incentive to act honestly.
As a student in an university, I am curious about how a course evaluation could perform well. Currently, it's far from satisfactory and it make no differences if students give a valid evaluation or not. According to the findings in this book, universities must introduce a meta-evaluation system and establish an incentive mechanism for students to improve the qualities of classes.