Price of Anarchy of Algorithmic Monoculture
This addresses the social welfare implications of widespread adoption of machine learning models in markets like hiring, showing that decentralized approaches are near-optimal, though it builds incrementally on prior work.
The paper tackles the problem of algorithmic monoculture in matching markets, where reliance on a common algorithmic advisor can lead to social welfare loss, and finds that decentralized optimization results in a tight constant bound of 2 on the price of anarchy.
Several recent works investigate the effects of monoculture, the ever increasing phenomenon of (possibly) self-interested actors in a society relying on one common source of advice for decision making, with an archetypal driving example being the growing adoption and predictive power of machine learning models in matching markets, e.g. in hiring. Kleinberg and Raghavan (PNAS, 2021) introduced a model that captures the effects of monoculture in a one-sided matching market with advice, demonstrating that a higher accuracy common signal (such as an algorithmic vendor) might incentivize society as a whole to rationally adopt it, but as a collective it would be better off if each instead adopted less accurate, but private advice. We generalize their model and address the open question of their work in quantifying the social welfare loss. We find that monoculture and more generally decentralized optimization is close to optimal: we show a tight constant bound of 2 on the price of anarchy (and more general notions) for the induced game.