PEER EFFECTS AND SOCIAL NETWORKS IN TECHNOLOGY ADOPTION: EVIDENCE FROM SINGAPORE PROPERTY AGENTS

Abstract

The growth of disruptive technology has fundamentally changed the way traditional businesses work in various industries. The rise of Property Technology, also known as PropTech, has likewise disrupted the real estate industry. For instance, the emergence of Do-It-Yourself (DIY) platforms like “OhMyHome” and “DirectHome” has posed a big threat to property agents by encouraging transactions without the need for intermediaries. In response to the threat where property agents may potentially be replaced by such DIY platforms in future, property agency OrangeTee launched the Property Agent Review (PAR) in 2016. The PAR allows buyers and sellers to rate and review the services of the agent they appointed after a successful transaction. The PAR provides better information and helps potential clients make a more informed choice on the most suitable agent based on the agent’s niche area in a specific property type or geographical location. Furthermore, previous studies have also shown that adopters experience a higher commission than non-adopters. Despite so, not all OrangeTee agents has adopted the PAR. Thus, this study aims to find out the factors influencing an agent’s decision to adopt the PAR by examining the effects of peers and social networks through intra-team and inter-team effects respectively. This is done using probit and fractional probit regression models. This paper also analyses the effect of team leaders and whether the presence of team leaders affect the intra-team and inter-team effects. Results show that peer effect is positive in technology adoption while social network and team leader effects are negative.