Design of Robust Business-to-Business Electronic Marketplaces with Guaranteed Privacy

Authors:
Joakim Kalvenes;Amit Basu
Affiliations:
Edwin L. Cox School of Business, Southern Methodist University, Dallas, Texas 75275;Edwin L. Cox School of Business, Southern Methodist University, Dallas, Texas 75275
Venue:
Management Science
Year:
2006

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Abstract

Firms that set up electronic marketplaces to enhance their supply and/or distribution channels face challenges in attracting their competitors to participate. A major obstacle is the perception that the owner can unfairly exploit trading information for competitive advantage. In this paper, we propose a marketplace design that shifts the locus of control over trader privacy from the marketplace operator to each individual trader. We show how online transactions between trading partners can be conducted in total privacy, so that not even the marketplace owner/operator can exploit transaction information for strategic purposes. At the same time, our approach includes robust methods for transaction integrity and nonrepudiation, as well as posttransaction dispute resolution.