How Does fake review Influence E-Commerce Platform Revenue?

We constructed a tripartite game model that includes consumers, sellers, and platforms to analyze the impact of fake reviews on platform revenue under different market structures. Results indicated that, in a monopoly market when the platform charges sellers transaction fees, on the one side, fake reviews yield more transaction cost for both consumers and sellers, thus generating less revenue for the platform. On the other side, if sellers choose to manufacture more fake reviews, consumers' perceived quality of product will increase in early time and the overall impact of fake reviews on platform revenue may be positive; however, in the long run, fake reviews will damage platform revenue. Furthermore, consumers' increased perceived quality will offset some of the negative impact from transaction costs if sellers choose other enhancement strategies instead of participating in review fraud. Moreover, more fake reviews will yield lower platform revenue when platforms are in a duopoly market. This study provides a theoretical basis for the platform to manage fake reviews.