Start Date
12-13-2015
Description
Analyzing the rapidly growing sharing economy, prior research primarily focused on the sharing of digital and underutilized goods. However, sharing such goods does not entail any sacrifice for the giver. In contrast, this study investigates the sharing of money in terms of referral rewards on peer-to-peer platforms. Sharing money is theoretically relevant as it is a zero sum game. Using data from two peer-to-peer platforms with different market structures, we investigate influential factors of peer-to-peer money sharing. The results show that an increase in the number of recommenders (i.e., people making referrals) creates positive cross-side and negative same-side network effects. Contrarily to findings from behavioral economics, more than half of the recommenders shared more than 70% of the pie with referral receivers. Reputation is an important competitive advantage for recommenders. The results indicate that sharing referral rewards on peer-to-peer platforms is beneficial for referring firms, recommenders and referral receivers.
Recommended Citation
Dose, David and Walsh, Gianfranco, "Sharing Money to Make Money - Analyzing Peer-to-Peer Sharing of Referral Rewards" (2015). ICIS 2015 Proceedings. 6.
https://aisel.aisnet.org/icis2015/proceedings/EconofIS/6
Sharing Money to Make Money - Analyzing Peer-to-Peer Sharing of Referral Rewards
Analyzing the rapidly growing sharing economy, prior research primarily focused on the sharing of digital and underutilized goods. However, sharing such goods does not entail any sacrifice for the giver. In contrast, this study investigates the sharing of money in terms of referral rewards on peer-to-peer platforms. Sharing money is theoretically relevant as it is a zero sum game. Using data from two peer-to-peer platforms with different market structures, we investigate influential factors of peer-to-peer money sharing. The results show that an increase in the number of recommenders (i.e., people making referrals) creates positive cross-side and negative same-side network effects. Contrarily to findings from behavioral economics, more than half of the recommenders shared more than 70% of the pie with referral receivers. Reputation is an important competitive advantage for recommenders. The results indicate that sharing referral rewards on peer-to-peer platforms is beneficial for referring firms, recommenders and referral receivers.