Computer Science > Computer Science and Game Theory
[Submitted on 3 Sep 2021 (v1), last revised 6 Sep 2021 (this version, v2)]
Title:Strictly Proper Contract Functions Can Be Arbitrage-Free
View PDFAbstract:We consider mechanisms for truthfully eliciting probabilistic predictions from a group of experts. The standard approach -- using a proper scoring rule to separately reward each expert -- is not robust to collusion: experts may collude to misreport their beliefs in a way that guarantees them a larger total reward no matter the eventual outcome. Chun and Shachter (2011) termed any such collusion "arbitrage" and asked whether there is any truthful elicitation mechanism that makes arbitrage impossible. We resolve this question positively, exhibiting a class of strictly proper arbitrage-free contract functions. These contract functions have two parts: one ensures that the total reward of a coalition of experts depends only on the average of their reports; the other ensures that changing this average report hurts the experts under at least one outcome.
Submission history
From: Eric Neyman [view email][v1] Fri, 3 Sep 2021 04:47:53 UTC (13 KB)
[v2] Mon, 6 Sep 2021 03:23:07 UTC (13 KB)
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