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| Type | Dissertation |
| Scope | Discipline-based scholarship |
| Title | Designing for trust in blockchain platforms : from exploring to making it real : the case of the Swiss "market of lemons" |
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| Institution | University of Zurich |
| Faculty | Faculty of Business, Economics and Informatics |
| Date | 2020 |
| Abstract Text | The automotive market is in the top three markets with least trust from consumers (followed by banks, and telecommunications industry) (Lades 2017). In particular, in the used car market, consumers encounter such problems as: a car in a poorer condition than initially indicated, accident damage that was not previously disclosed, little or no documentation provided, and fraud. Nobel prize winner G.A. Akerlof described the market for used cars as an example of the problem of information asymmetries and resulting quality uncertainty (Akerlof 1970). In my dissertation, I look at how an application on top of blockchain technology, which is claimed to bring trust by design due to its inherent characteristics, may be designed as a novel solution to resolve problems in the ‘Market for Lemons’ and, thus, enhance trust between buyers and sellers. While there may be some genuine trust in blockchain technology itself, on an application level, trust in an IT artifact needs to be established. This need for trust establishment is at heart of this dissertation project. This cumulative dissertation is structured in three parts. In part I, I explore the characteristics of blockchain platforms and relevant aspects for their design (i.e., the data quality aspect and token design). In part II, I propose a design to address problems associated with a of lack of trust, caused by information asymmetries, between car buyers and car sellers with the help of an IT artifact: a blockchain-based cardossier. The cardossier application reflects a car’s history over its whole lifecycle (from production to utilization). The proposed design relates to the end-user-facing frontend application. In this part, I focus on the problems and needs of used car buyers, the requirements placed for the design of the application, the actual elements of the application design, and the effects of the application’s usage in the ‘Market for Lemons’. The results show that the problems buyers experience are a paradox of having a large variety of information sources available about brands, and the quality characteristics and performance of certain models; while information about a specific car is not transparent and often even hidden. Though providing more information about a used car leads to fewer information asymmetries in general, advanced information elements are beneficial in improving the situation further. As for trust, such a system enhances trust between buyers and sellers and, in general, makes the overall purchase process more trustworthy. However, to achieve these positive effects, the quality of the stored information should be guaranteed and properly communicated to the end-user. Additionally, exploring the use of the cardossier, embedded into an online used car sales platform, several groups of factors (technology-related, data-related, design-related, user-related) that play an important role in trust formation were revealed. Furthermore, through adopting the perspective of technology affordances, we identified blockchain platform affordances related to the trust in a blockchain platform. In part III, the transfer of a research project into practice, preparation for market entry, associated tensions the blockchain consortium had to face while implementing the platform are discussed along three themes: consortium management, business value, and governance. Altogether, the three parts of the dissertation provide better understanding of blockchain platforms, applications built on top of them and their usage in the ‘Market for Lemons’. Thus, this dissertation contributes to the body of knowledge on trust design in the context of blockchain technology and applications on top of it, and also to the broader literature on examining the ‘Market for Lemons’ and solutions to its problems. As blockchain applications are still being developed, and as we are just beginning to understand the potential of the blockchain technology, such research has scientific value in terms of design and organizational implications. |
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| Other Identification Number | merlin-id:19667 |
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