A prediction market game to route selection under uncertainty

Abstract

This paper addresses a route selection problem under uncertainty. The structure of the problem can be captured as an ordinal shortest path problem of a directed graph. However, the length of each arc of the graph is an uncertain random variable and its probability distribution is unknown to the decision maker; instead, information on the distribution is dispersed among the crowd. Under this set of circumstances, this paper provides a prediction market game for gathering the dispersed information from the crowd and thereby solving the reformulated problem. Further, the proposed gaming approach is applied to a simple real-life problem to understand how it works. © 2014 Springer International Publishing Switzerland.