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A model of providing service in a P2P network is analyzed. It is shown thatby adding a scrip system, a mechanism that admits a reasonable Nash equilibriumthat reduces free riding can be obtained. The effect of varying the totalamount of money (scrip) in the system on efficiency (i.e., social welfare) isanalyzed, and it is shown that by maintaining the appropriate ratio between thetotal amount of money and the number of agents, efficiency is maximized. Thework has implications for many online systems, not only P2P networks but also awide variety of online forums for which scrip systems are popular, but formalanalyses have been lacking.

Efficiency and Nash Equilibria in a Scrip System for P2P Networks