The Effects of fake reviews on TripAdvisor website: an agent-based model

This paper focuses on the well-known tourist web-site TripAdvisor and a recent judicial review by the Italian Administrative Court. The Court (TAR) overturned the decision by the Antitrust Authority and abolished the heavy penalty originally imposed on TripAdvisor on the assumption that false web-site reviews will definitely not affect the economic behaviour of consumer/travellers. So, the complex legal matter will be reconsidered and starting with the Authority resolution, we will investigate the most interesting aspects of the TAR overturn. The two antithetical provisions mirror divergent positions regarding consumer protection and enforcement against ‘unfair commercial practices’. For these reasons this juridical examination is supported by economic analysis to define the extent to which the lack of controls which promotes false reviews can influence information quality and travellers’ choices. By means an agent-based simulation model which replicates the TripAdvisor system and interactions between hotels and travellers with no provider controls, we will be able to verify whether changes in a hotel's ranking depends either on the number of hotels in the area or on the number of reviews. Ultimately, the analysis will gather suggestions for policies to define the percentage of false reviews for each level of traveller propensity to deceive.