Monopolizing markets by exploiting trust

We investigate trust-based relationships in electronic supply chains where trust is a measure of consistency in meeting negotiated contract deadlines. We consider scenarios where contractors assign contracts to contractees who are significantly more successful in meeting deadlines. The task deadlines are drawn from a known distribution. We present a probabilistic analysis that enables contractees to strategically bid on only certain tasks to earn the trust of their contractors. Once a contractee achieves a high level of trust, it can then exploit that trust to increasingly corner a larger portion of the market share of all tasks. We present a trust exploitation scheme that monopolizes the market against greedy contractees who bid on all announced tasks. We also show that such market monopolization is not possible in the presence of a trusted, but non-exploiting, contractee. The exploiter can, however, effectively "starve" the nonexploiting trusted agent. Categories and Subje...

• Type: Conference
• Year: 2006
• Where: ATAL
• Authors: Sandip Sen, Dipyaman Banerjee
• Keywords: ATAL 2006, Intelligent Agents, Supply Chains, Trust, Trust Exploitation Scheme