Analysis of reputation-based incentive mechanisms in ad hoc networks

The incentive mechanisms based on reputation are often used to induce cooperation among selfish nodes in ad hoc networks. In those mechanisms nodes with lower reputation value will receive less benefit, which suffers from a new problem of second-ordered free riding. Refusing service request from bad nodes will increase the defector's own reputation, so refusing isn't a favorable choice. Mitigating this new selfish behavior is important to improve the cooperation in ad hoc networks and enhance system robustness. The paper discusses the second-ordered free-riding problem in incentive mechanism for packet forwarding in ad hoc networks and proposes a new scheme based on second-ordered reputation combining with a probabilistic service assignment rule. It is proved that the new scheme is available and cooperation can be built in various network settings.