Spotting Lemons in the PKI Market: Engendering Trust by Signalling Quality

Public key infrastructure (PKI) has emerged as a critical technology for identity management in e-commerce and e-government and over a hundred Certification Authorities across the globe offer certification services. Despite the passing of legislation in many countries to give equal legal weight to electronic signatures as to handwritten ones, the overall market for digital certificates has not expanded as much as was originally thought. The literature indicates a range of possible issues holding back widescale adoption of PKI ranging from technical, policy, legal and regulatory. In this paper, we focus on the question of quality uncertainty, and hence on trust, and use an economic theory, the Lemons principle, to examine the market context for digital certificates. A review follows of three ways, namely brand names, guarantees and licensing, to signal the quality of certificates and so engender some of the trust that is required for the relying party to accept and use certificates when they are offered.