Consumer-to-Consumer Digital-Product-Exchange in the Sharing Economy System with Risk Considerations: Will Digital-Product-Developers Suffer?
Journal
IEEE Transactions on Systems, Man, and Cybernetics: Systems
Journal Volume
50
Journal Issue
12
Pages
5049-5057
Date Issued
2020
Author(s)
Abstract
In the sharing economy system, consumer-to-consumer product-exchange (C2C-PE) for digital products is commonly seen. In this paper, we analytically explore the C2C-PE problem for digital products. To be specific, we consider the presence of a digital product developer (DPD) who develops and sells a product to consumers in the market. Consumers possess random valuation toward the digital product and the DPD needs to decide the optimal selling price for the product. We study the impacts brought by C2C-PE. We try to uncover whether (and when) DPDs and consumers will be benefited by the presence of C2C-PE. In the basic model, when all parties are risk neutral, we find that the presence of C2C-PE is always beneficial to the DPD and consumers. To show the robustness of results in the basic model, we further extend the analysis to cover a few cases and prove that this conclusion holds irrespective of the DPD's risk averse attitude, the consumers' risk averse attitude, as well as whether the utility gained from C2C-PE is effort dependent or not. Hence, we conclude that C2C-PE, which seems to be harmful to DPDs, is in fact a beneficial scheme to both the DPDs and consumers. ? 2013 IEEE.
Subjects
Consumer-to-consumer product-exchange (C2C-PE); digital product; sharing economy systems
Other Subjects
Consumer products; Risk analysis; Digital products; Optimal selling price; Risk averse; Risk neutrals; Risk assessment
Publisher
Institute of Electrical and Electronics Engineers Inc.
Type
journal article