Fly or fall with the wings of live streamers? Quality signaling and platform governance in live streaming commerce

Abstract Platforms play a regulatory role in governing live streamers. We build an analytical model to study the platform governance and its impacts on the signaling effects of live streamers. Unlike traditional signaling games, we incorporate the interaction between consumers and live streamers, and the signaling costs also relate to platform governance. Results indicate that low marginal costs for governance do not necessarily induce the platform to govern live streamers rigorously, especially when consumers and live streamers lack interaction. Strict governance can help the signaling effects of live streamers.