Feedback Elicitation Mechanism Design

Abstract

Peer-to-peer sharing economy such as Uber and Airbnb has played an essential role in the global economy. Different from the traditional rental economy, sharing economy does not guarantee standard services for its users and the service quality is largely monitored by the users via their evaluations/feedbacks of the service. However, in the existing sharing economy markets, users are not incentivized to offer their true feedbacks to the platforms, and they are often incentivized to misreport. Therefore, our goal is to design reward mechanisms that can incentivize the users to report they are true feedbacks. The existing work has considered the problem when the feedbacks are binary (e.g., good or bad), but the feedbacks in practice are usually n-ary. Therefore, we propose a novel framework to design reward mechanisms which incentivize users to report their feedbacks truthfully when the feedbacks are n-ary. This is achieved by designing a proper reward scheme such that reporting feedback truthfully is a Nash equilibrium given that the cost of the platform is minimized. We form the problem as a linear program, which takes incentivizing users to report truthfully as constraints and minimizes the cost to the platform. The linear program is solved via its dual problem. Under a proper condition, we get a special solution structure of the linear program. This special structure allows us to derive a general solution form which does not need to solve the linear program in a brute force manner and the computation complexity is significantly reduced.