Yahoo have marvelous help available for anyone embarking on building a reputation system for a social application. Some salient points for me are to think about what type of system would suit your website/or project. Yahoo offer a good chart to help you think about it:

The first question is maybe: what are your users like and what values do you want to foster through the applications that you build?

We are fortunate to have a many social network sites to look at and learn from. And there is plenty to read. The best advice I have found I read here - and the basic gist is, make sure you build a reputation system that marries the incentives you have for your users with the wider objectives you have for the community as a whole. Sounds sensible to me!.

Once you've done that Yahoo provide some really useful guides on different types of reputation systems. For example, for competition you may introduce a points system. Or, if you want to reward engagement and facilitate personal development you may want to go for named levels

None of this, I am sure, will guarantee the success of the social application you build. But it will definitely have helped to have thought about it way in advance of having your first 1000 signed up.