Barter Exchange via Friends' Friends

TL;DR

This paper proposes a truthful barter exchange mechanism based on the Top Trading Cycle algorithm that incentivizes participants to invite neighbors, aiming to increase participation without extra budget.

Contribution

It introduces a novel exchange mechanism that aligns incentives for participants to invite neighbors, enhancing participation in barter exchanges without additional costs.

Findings

Mechanism is truthful in preference revelation.

Inviting all neighbors is a dominant strategy.

Applicable without extra budget for outreach.

Abstract

Barter exchange studies the setting where each agent owns a good, and they can exchange with each other if that gives them more preferred goods. This exchange will give better outcomes if there are more participants. The challenge here is how to get more participants and our goal is to incentivize the existing participants to invite new participants. However, new participants might be competitors for the existing participants. Therefore, we design an exchange mechanism based on the classical Top Trading Cycle (TTC) algorithm to solve their conflicts. Our mechanism is truthful in terms of revealing their preferences and also guarantees that inviting all their neighbors is a dominant strategy for all participants. The mechanism can be applied in settings where more participants are preferred but no extra budget to reach new participants.