Lee, G. M., Choi, T., and Zhang, Y. (2007). Designing an Incentive-Based Framework for Overlay Routing. UTCS Technical Report, January 2007.

Overlay routing becomes popular as an incremental mechanism to improve internet routing. So far, overlay nodes are always assumed to cooperate with each other. In this paper, we analyze overlay routing in a new viewpoint, in which the overlay nodes act independently to maximize their own payoff. We use a game-theoretic approach to analyze the transit traffic forwarding and realize that overlay nodes are not likely to cooperate with each other in our new scenario.

In order to stimulate the independent overlay nodes to cooperate with each other, we design and propose an incentive-based framework. We introduce three possible systems and evaluate them analytically. Among the candidates, we use simulation to verify the feasibility of our proposed framework generalized punish-and-reward system. The performance gets closer to social optimum as we increase the number of punishments. In addition, the system shows tolerance against impatient players.