Just as pickpockets are attracted to crowds in real space, the success of auctions in cyberspace is attracting cheats and frauds. The main types of fraud occur when items that are bought and paid for are never delivered, or the goods that are delivered are inferior. Many commentators are demanding new laws to counteract the surge in fraud. Before clogging the Internet with more regulations, however, self-policing by the online auction industry should be given more time to work. Much of what is sold at online auctions are household items that people no longer need.
Online auctions are a cross between flea markets, yard sales and estate auctions.
The difference is that buyers and sellers meet in cyberspace rather than in a front yard or a back lot. In physical space, transaction costs, such as travel, prohibit my yard sale from being a blockbuster event. Most of the people who might want my lava lamp do not live near me. In cyberspace, however, my lava lamp is only a click away. Each of these proposals is fatally flawed, however.