Gatekeeping in Online Markets: An Empirical Investigation of IT-based Self-regulation in Online Black Markets

This study examines how IT-based gatekeeping mechanisms influence platform survival in Online Black Markets (OBMs), anonymous, self-regulated marketplaces where buyers and vendors exchange illegal goods in absence of formal rules and regulatory bodies. In these high-conflict environments, platform owners rely on technological gatekeeping as a form of enhanced self-regulation, delegating specific control functions to IT-based intermediaries such as reputation systems, escrow services and access filters. Employing a sequential exploratory mixed-methods approach, we first conducted a qualitative case study of OBMs and then tested the impact of these mechanisms using quantitative survival analysis on a dataset of 56 OBMs spanning 54 months. Our findings reveal that controlling platform access enhances survival, whereas delegating transaction control to third parties increases failure risk. These insights advance the understanding of gatekeeping as a dynamic, IT-based self-regulation process to address conflicting practices in online markets and contributes to platform governance literature by highlighting the risks of decentralizing transaction control in high-conflict online environments.