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Journal of Undergraduate Research

Keywords

community affair, public consumption, redistribution markets, trade

College

Marriott School of Management

Department

Marketing

Abstract

In this research we set out to understand why people choose to trade in redistribution markets. We define a redistribution market as a market where people swap good-for-good, and no cash exchanges take place. Economic theory predicts that individuals would be reluctant to trade dissimilar items (e.g. a book for a cd player). Given that trades of this sort take place in venues like swap.com and bookings.com; online sites where people trade hundreds of items per day, we sought to find a theory that would explain this behavior. Our hypothesis is that the way individuals value their goods (inferred value of their goods) is contingent on environmental cues and the consumption context. Specifically, that being in the site of others (known as public consumption) would attenuate the necessity for similarity in products. In simple terms, swapping is more likely to take place in a public domain than a private one (Under the view of others, versus private).

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