Star-Cursed Lovers: Role of Popularity Information in Online Dating

We examine the effect of user's popularity information on their demand in a mobile dating platform. Knowing that a potential partner is popular can increase their appeal. However, popular people may be less likely to reciprocate. Hence, users may strategically shade down or lower their revealed preferences for popular people to avoid rejection. In our setting, users play a game where they rank-order members of the opposite sex and are then matched based on a stable matching algorithm. Users can message and chat with their matches after the game. We quantify the causal effect of a user's popularity (star rating) on the rankings received during the game and the likelihood of receiving messages after the game. To overcome the endogeneity between a user's star rating and her unobserved attractiveness, we employ nonlinear fixed-effects models. We find that popular users receive worse rankings during the game, but receive more messages after the game. We link the heterogeneity across outcomes to the perceived severity of rejection concerns and provide support for the strategic shading hypothesis. We find that popularity information can lead to strategic behavior even in centralized matching markets if users have postmatch rejection concerns.