Crowdsourcing with Tullock contests: A new perspective
This addresses the challenge of incentivizing participation in crowdsourcing platforms, offering a novel mechanism that enhances both organizer utility and participant welfare, though it is incremental in the context of contest-based incentive design.
The paper tackles the problem of designing incentive mechanisms for crowdsourcing by proposing Tullock contests with a prize function dependent on the winner's contribution, rather than fixed prizes, to maximize the crowdsourcer's utility. It shows that this approach significantly outperforms optimal fixed-prize benchmarks, achieving over threefold gains in utility and up to ninefold improvements in social welfare.
Incentive mechanisms for crowdsourcing have been extensively studied under the framework of all-pay auctions. Along a distinct line, this paper proposes to use Tullock contests as an alternative tool to design incentive mechanisms for crowdsourcing. We are inspired by the conduciveness of Tullock contests to attracting user entry (yet not necessarily a higher revenue) in other domains. In this paper, we explore a new dimension in optimal Tullock contest design, by superseding the contest prize---which is fixed in conventional Tullock contests---with a prize function that is dependent on the (unknown) winner's contribution, in order to maximize the crowdsourcer's utility. We show that this approach leads to attractive practical advantages: (a) it is well-suited for rapid prototyping in fully distributed web agents and smartphone apps; (b) it overcomes the disincentive to participate caused by players' antagonism to an increasing number of rivals. Furthermore, we optimize conventional, fixed-prize Tullock contests to construct the most superior benchmark to compare against our mechanism. Through extensive evaluations, we show that our mechanism significantly outperforms the optimal benchmark, by over three folds on the crowdsourcer's utility cum profit and up to nine folds on the players' social welfare.