---
title: "A Polynomial-time, Truthful, Individually Rational and Budget Balanced Ridesharing Mechanism"
authors:
  - "Tatsuya Iwase"
  - "Sebastian Stein"
  - "Enrico H. Gerding"
doi: "10.24963/ijcai.2021/38"
url: "https://ijcai.org/proceedings/2021/38"
pdf: "https://ijcai.org/proceedings/2021/0038.pdf"
venue: "Proceedings of the Thirtieth International Joint Conference on Artificial Intelligence"
year: 2021
pages: "268-275"
track: "Main Track"
keywords:
  - "Agent-based and Multi-agent Systems: Coordination and Cooperation"
  - "Agent-based and Multi-agent Systems: Economic Paradigms, Auctions and Market-Based Systems"
  - "Multidisciplinary Topics and Applications: Transportation"
---

# A Polynomial-time, Truthful, Individually Rational and Budget Balanced Ridesharing Mechanism

Tatsuya Iwase, Sebastian Stein, Enrico H. Gerding

*Proceedings of the Thirtieth International Joint Conference on Artificial Intelligence*, pages 268-275. DOI: [10.24963/ijcai.2021/38](https://doi.org/10.24963/ijcai.2021/38)

## Abstract

Ridesharing has great potential to improve transportation efficiency while reducing congestion and pollution. To realize this potential, mechanisms are needed that allocate vehicles optimally and provide the right incentives to riders. However, many existing approaches consider restricted settings (e.g., 
only one rider per vehicle
or a common origin for all riders). Moreover, 
naive applications of standard approaches, such as the Vickrey-Clarke-Groves or greedy mechanisms, cannot achieve a polynomial-time, truthful, individually rational and budget balanced mechanism. To address this, we formulate a general ridesharing problem and apply mechanism design to develop a novel mechanism which satisfies all four properties and whose social cost is within 8.6% of the optimal on average.