Analysis on the Game Model of Transaction Parties in E-commerce

The information asymmetry has seriously hindered the development of E-commerce. Merchants have the superiority of information, while consumers are in a disadvantaged position in this aspect. This paper only discusses whether the merchant takes an honesty strategy or not. Therefore, merchants' strategy options include the honesty or dishonesty strategy, and consumers' strategy options include buying or no-buying. Accordingly, this paper built the game model for both parties in E-commerce transactions. After solving and analyzing it, we find: (1) When R(1) >= R(2) (R(1) is the merchant's benefit when merchants choose the honesty strategy and consumers choose the buying strategy; R, is the merchant's benefit when merchants choose the dishonesty strategy and consumers choose the buying strategy), the model has an unique Nash equilibrium solution (honesty, buying); CD When R(1) < R(2), the model, which is a mixed strategy with complete information, does not has an unique Nash equilibrium solution. Based on the analysis above, this paper then put forward a number of countermeasures and proposals through which the proceed from taking the honesty strategy for merchants is greater than or equal to that from taking the dishonesty strategy, namely R(1)>= R(2).