To Travel Quickly or to Park Conveniently: Coupled Resource Allocations with Multi-Karma Economies

TL;DR

This paper investigates how to optimally combine multiple karma-based resource allocation mechanisms in complex cyber-physical-human systems, demonstrating that simple uniform redistribution with unit exchange rates maximizes social welfare.

Contribution

It extends the Dynamic Population Game model to multi-karma economies and analyzes the impact of redistribution and exchange rates on coupled resource allocations.

Findings

Redistribution significantly influences resource allocation outcomes.

Non-unit exchange rates have a minor effect.

Simple uniform redistribution with unit exchange rates achieves maximum social welfare.

Abstract

The large-scale allocation of public resources (e.g., transportation, energy) is among the core challenges of future Cyber-Physical-Human Systems (CPHS). In order to guarantee that these systems are efficient and fair, recent works have investigated non-monetary resource allocation schemes, including schemes that employ karma. Karma is a non-tradable token that flows from users gaining resources to users yielding resources. Thus far karma-based solutions considered the allocation of a single public resource, however, modern CPHS are complex as they involve the allocation of multiple coupled resources. For example, a user might want to trade-off fast travel on highways for convenient parking in the city center, and different users could have heterogeneous preferences for such coupled resources. In this paper, we explore how to optimally combine multiple karma economies for coupled resource allocations, using two mechanism-design instruments: (non-uniform) karma redistribution; and (non-unit) exchange rates. We first extend the existing Dynamic Population Game (DPG) model that predicts the Stationary Nash Equilibrium (SNE) of the multi-karma economies. Then, in a numerical case study, we demonstrate that the design of redistribution significantly affects the coupled resource allocations, while non-unit exchange rates play a minor role. To assess the allocation outcomes under user heterogeneity, we adopt Nash welfare as our social welfare function, since it makes no interpersonal comparisons and it is axiomatically rooted in social choice theory. Our findings suggest that the simplest mechanism design, that is, uniform redistribution with unit exchange rates, also attains maximum social welfare.