An incentives' mechanism promoting truthful feedback in peer-to-peer systems

We propose a mechanism for providing the incentives for reporting truthful feedback in a peer-to-peer system for exchanging services. This mechanism is to complement reputation mechanisms that employ ratings' feedback on the various transactions in order to provide incentives to peers for offering better services to others. Under our approach, both transacting peers (rather than just the client) submit ratings on performance of their mutual transaction. If these are in disagreement, then both transacting peers are punished, since such an occasion is a sign that one of them is tying. The severity of each peer's punishment is determined by his corresponding non-credibility metric; this is maintained by the mechanism and evolves according to the peer's record. When under punishment, a peer is not allowed to transact with others. We present the results of a multitude of experiments of dynamically evolving peer-to-peer systems. The results show clearly that our mechanism detects and isolates effectively liar peers, while rendering lying costly. Also, our mechanism diminishes the efficiency losses induced to sincere peers by the presence of large subsets of the population of peers that provide their ratings either falsely or according to various unfair strategies. Finally, we explain how our approach can be implemented in practical cases of peer-to-peer systems.