Information Architecture and Electronic Market Performance

Electronic markets are one of the most prominent business applications\nof the Internet, so determining the factors that drive their\nperformance is of great value. This thesis shows that an important\ndriver of electronic market performance is the information architecture\nof the market, which describes what type of information is\navailable to whom during the market process. Two studies of\nelectronic market initiatives at a large Dutch flower auction highlight\nhow information and communication technology (ICT) affects\nthe information architecture of the market and the consequences\nfor market behavior. ICT not only affects existing markets, but also\noffers opportunities to design innovative new market mechanisms.\nOne of these is a multidimensional auction, in which bidders bid not\nonly on price, but also on dimensions such as quality and delivery\ntime. The effects of different information architectures of multidimensional\nauctions are explored in laboratory experiments.\nThe findings of the three studies are synthesized into a theory of\nelectronic markets that has important implications for market\ndesigners, traders and researchers.