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Abstract
Standard economic theory does not capture trust among anonymous Internet traders. But when traders are allowed to have social preferences, uncertainty about a seller's morals opens t he door for trust, reward, exploitation and reputation building. We report experiments suggesting that sellers' intrinsic motivations to be trustworthy are not sufficient to sustain trade when not complemented by a feedback system. We demonstrate that it is the interaction of social preferences and cleverly designed reputation mechanisms that solves to a large extent the trust problem on Internet market platforms. However, economic theory and social preference models tend to underestimate the difficulties of promoting trust in anonymous online trading communities.

Abstract. In this article simulation results are used to analyze the capacity of a general politico‐economic model, developed by one of the authors, to generate cycles of various lengths. The model describes behaviour of individuals and organizations in the economic as well as the political sphere. The interaction between both spheres gives rise to short term (business) cycles as well as long term (Kondratieff) cycles. The analyses concentrate on the effect variations in the political sector (regarding, e.g., party identification on non‐economic grounds, the sensitivity of voters, and the discount parameter for past economic results) have on the cycles found.