Incentive Mechanism in the Sponsored Content Market with Network Effect

Abstract

We propose an incentive mechanism for the sponsored content provider market in which the communication of users can be represented by a graph and the private information of the users is assumed to have a continuous distribution function. The content provider stipulates incentive rewards to encourage users to reveal their private information truthfully and increase their content demand, which leads to an increase in advertising revenue. We prove that all users gain a non-negative utility and disclose their private information truthfully. Moreover, we study the effectiveness and scalability of the proposed mechanism in a case study with different network structures.