1st International ICST Workshop on Game Theory for Networks

Research Article

A peer-to-peer system as an exchange economy

  • @INPROCEEDINGS{10.1145/1190195.1190206,
        author={Christina  Aperjis and Ramesh  Johari},
        title={A peer-to-peer system as an exchange economy},
        proceedings={1st International ICST Workshop on Game Theory for Networks},
        keywords={Peer-to-peer systems exchange economy},
  • Christina Aperjis
    Ramesh Johari
    Year: 2012
    A peer-to-peer system as an exchange economy
    DOI: 10.1145/1190195.1190206
Christina Aperjis1,*, Ramesh Johari1,*
  • 1: Stanford University, Stanford, CA, 94305
*Contact email: caperjis@stanford.edu, ramesh.johari@stanford.edu


We formulate a peer-to-peer system for filesharing as an exchange economy: a price is associated with each file, and users exchange files only when they can afford it. This formulation solves the free-riding problem, since uploading files is a necessary condition for being able to download. However, we do not explicitly introduce a currency; users must upload files in order to earn a budget for downloading. We discuss existence, uniqueness, and dynamic stability of the competitive equilibrium, which is always guaranteed to be Pareto efficient. In addition, a novel aspect of our approach is an allocation mechanism for clearing the market out of equilibrium. We analyze this mechanism when users can anticipate how their actions affect the allocation mechanism (price anticipating behavior). For this regime we characterize the Nash equilibria that will occur, and show that as the number of users increases, the Nash equilibrium rates become approximately Pareto efficient.