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This paper presents a mechanism design-based approach to tackle the crowdshipping problem in which a delivery service provider (DSP) solicits ordinary individuals, termed crowdsourcees, who use their limited available time to perform urban parcel delivery. The DSP collects private information from crowdsourcees while assigning shipments to minimize the cost of delivery. Given that crowdsourcees may strategically misreport private information, the assignment is devised with a payment rule to incentivize truthful reporting. . Doing so requires additional payment to crowdsourcees, whose asymptotic properties are investigated. We extend the static mechanism to a dynamic case by performing assignment periodically and examine the bounds for periodicity. Numerical results show that the proposed mechanisms will likely reduce shipping cost compared to three alternative scenarios: 1) no such mechanism is in place; 2) the DSP pays crowdsourcees at a fixed rate; and 3) truck-only delivery. Several additional insights from the mechanism implementation are further obtained.

Designing mechanisms for crowdsourced urban parcel delivery