Platform Policies and Quality Class: When are Hotels Prone to Rating Manipulation?

Online platforms depend on trust and reputation, yet these are open to manipulation. This paper develops a game-theoretic model of rating manipulation that accounts for platform enforcement policies, market competition, and class differentiation among service providers. The model shows that stricter sanctions can paradoxically increase incentives to manipulate by reducing competition, while greater competition reduces manipulation. To illustrate the model’s applicability, we analyze hotel reviews from Bangkok collected from Agoda, where only verified customers can post reviews, and TripAdvisor, where reviews are open to all users. The empirical results confirm that lower-class hotels are more prone to manipulation than higher-class hotels, consistent with theoretical predictions. Together, the theoretical and empirical findings provide insights for the design of trust and reputation systems in online platforms, highlighting trade-offs between enforcement, competition, and the integrity of ratings.