An auction-based mechanism to promote cooperation in resource exchange networks

Abstract

In this paper, we propose a framework to analyze the markets in which resources are exchanged without the use of money. Although individual agents might want unrestricted access to the marketplace, communities to which they belong to may want to impose various restrictions on participation, thus damaging the overall social welfare. We study the dynamics of these markets using agent-based modeling and propose a credit mechanism to promote cooperation among communities. This credit mechanism can be used by the marketplace to match individual agents and is based on iterative Vickery auctions. We present the results of several experiments to simulate different settings of resource exchange markets and validate the performance of the mechanism.