Note that I am asking what it should be, not how it works, and not how people feel about it. It’s all too obvious how people feel about it.
What is the purpose of Stack Overflow reputation? sounds like a duplicate, but it didn’t get answered there.
I thought I read somewhere that it was to make it easier to find better questions and better answers.
Yet I see numerous complaints, even some whin(g)ing, about losing points or not getting them, with words like “penalized” or “punished.” (I’m not talking about the far fewer curious questions trying to understand an anonymous unexplained downvote.)
So which is it? A tool to gauge quality/improve the community, or a competition between rivals?