TITLE:
Impact of Quality Certification on Used Merchandise Transaction Behavior in Developing Countries, Involving Retailers and Consumers
AUTHORS:
Syed Abdul Rehman Khan, Adeel Shah
KEYWORDS:
Used Merchandise, Certification, Transactions, Game Theory
JOURNAL NAME:
Open Journal of Social Sciences,
Vol.9 No.10,
October
29,
2021
ABSTRACT: The trade-in of used merchandise globally is high, as it allows the consumer to satisfy their needs at a lesser price. As the category grows over time, the quality requirement and assurance are also increasing and supported with relevant quality certification. For understanding the quality certification in used merchandise, the paper explores the evolutionary process of the phenomena. The research attempts to create an evolutionary game model encompassing retailers and consumers trading used merchandise. Further, the model used for the analysis assumes that retailers have examined and repair the (E and R) capability of the used inventory. The model suggests that purchase and selling prices do not affect the stable evolutionary strategy (ESS); however, the cost of quality certification significantly impacts the model. The E and R capability of retailers impact the transaction as it reduces the price of used merchandise. The transaction cost and utility of the merchandise are motivating factors for the used market. Based on the research outcomes, government regulators should participate in the used merchandise transaction by providing a low-cost quality certification. The governmental authorities should intercede to offer a fair environment for both retailers and consumers and earn revenue as a minimum fee on the transaction.