But, If you are a merchant and then enters a spawn of baal, killer of dozens of Flaming Fists, armor made of the skin of dead dryads, weapons stained in fresh blood, a reputation of killing grannies that look at him funny and eat baby unicorns for breakfast... Are you really going to charge him double price in your sales? What could possibly go wrong?
That's an interesting perspective.
I think it will be a good idea to positive incentives to Good, Neutral, and Evil.
Some illegal shops and certain NPCs might react better to Evil reputation. And I think the party should be able to pay money to get bad reputation.
In Baldur's Gate you can donate to a temple and get good reputation.
It would be an improvement if you can donate to the Thieves guild for example and gain bad reputation.
The hard part is to figure out positive incentives for Neutral reputation.
I can't think of much myself.