Agent's quest for reputation and referrals from past and present customers as the agent's source of business

This paper examines the relationship between real estate agent's quest for reputation and referrals from past and current customers as the agent's source of business. The research results suggest that there is a significant strong positive correlation between the agent's quest for reputation and referrals as the agent's source of business for the last five years. The research finding has a relevant implication to the real estate industry. The principal-agent relationship in the residential housing market is somewhat paradoxical and fraught with moral-hazard problem created by information asymmetry. The finding in this study could be used as a stepping stone to address the question whether the strong relationship between the real estate agent's quest for reputation and referrals from past and present customers as the agent's source of business minimises moral-hazard problem in the agent's service.