Eliminating Undesired Equilibrium Points from Incentive Compatible Reputation Mechanisms

Choosing the best out of an increasing number of options requires reliable and accurate information. As our time and resources are limited, we commonly use the experience of others to take decisions. Reputation mechanisms aggregate in a formal way the feedback collected from peers and compute the “reputation” of products, services, or providers. They enjoy huge success and are believed to be the key of the agent mediated commerce of tomorrow. Obtaining honest feedback from self-interested agents is not a trivial problem. Mechanisms based on side-payments can be conceived such that honest reporting becomes rational (i.e. Nash equilibrium). Unfortunately, for every incentivecompatible NEQ there seems to also be a dishonest NEQ strategy that sometimes is more attractive. Trusted reports (true reports coming from specialized agents) can be used to eliminate such undesired NEQ points. They provide reference information that can help determine the truthfulness of other reports. When enough trusted reports are available, the incentive compatible NEQ becomes unique. In this paper we investigate the influence of trusted reports on the set of equilibrium points of the reputation mechanisms described in [3] and [1]. While the specific results of this paper are only applicable to the two mechanisms mentioned above, this paper introduces a general methodology for studying the influence of trusted reports on the equilibrium points of a reputation mechanism.