(micro)payments for anonymous routing in Tor?

[Christian Siefkes]

Josh Albrecht wrote:
> I think that people would contribute unpaid bandwidth to the network
> for the same reason that they do now (altruism), especially if it were
> the default setting (how many people really change the defaults?).
> However, I see the incentives (bandwidth/monetary) as important to get
> lots more people using Tor in the first place, which would hopefully
> increase the total amount of free/unpaid bandwidth available through
> the network.

Introducing a paid option would probably drive non-paid volunteers away.
That's because of the "Crowding-out Effect" which says that efforts to
motivate people extrinsically (through money) will often demotivate people
whose motivation is intrinsic ("doing what is right" or" doing something for
the sake of it").

See, for example, Yochai Benkler, "The Wealth of Networks" (Yale University
Press, 2006), p. 93-95:

    A number of scholars, primarily in psychology and economics, have
    attempted to resolve this question [why the British all-volunteer based
    blood donor system worked much better than the old American
    payment-based one] both empirically and theoretically. The most
    systematic work within economics is that of Swiss economist Bruno Frey
    and various collaborators, building on the work of psychologist Edward
    Deci. A simple statement of this model is that individuals have
    intrinsic and extrinsic motivations. Extrinsic motivations are imposed
    on individuals from the outside. They take the form of either offers of
    money for, or prices imposed on, behavior, or threats of punishment or
    reward from a manager or a judge for complying with, or failing to
    comply with, specifically prescribed behavior. Intrinsic motivations
    are reasons for action that come from within the person, such as
    pleasure or personal satisfaction. Extrinsic motivations are said to
    "crowd out" intrinsic motivations because they (a) impair
    self-determination--that is, people feel pressured by an external
    force, and therefore feel overjustified in maintaining their intrinsic
    motivation rather than complying with the will of the source of the
    extrinsic reward; or (b) impair self-esteem--they cause individuals to
    feel that their internal motivation is rejected, not valued, and as a
    result, their self-esteem is diminished, causing them to reduce effort.
    Intuitively, this model relies on there being a culturally contingent
    notion of what one "ought" to do if one is a well-adjusted human being
    and member of a decent society. Being offered money to do something you
    know you "ought" to do, and that self-respecting members of society
    usually in fact do, implies that the person offering the money believes
    that you are not a well-adjusted human being or an equally respectable
    member of society. This causes the person offered the money either to
    believe the offerer, and thereby lose self-esteem and reduce effort, or
    to resent him and resist the offer. A similar causal explanation is
    formalized by Roland Benabou and Jean Tirole, who claim that the person
    receiving the monetary incentives infers that the person offering the
    compensation does not trust the offeree to do the right thing, or to do
    it well of their own accord. The offeree's self-confidence and
    intrinsic motivation to succeed are reduced to the extent that the
    offeree believes that the offerer--a manager or parent, for example--is
    better situated to judge the offeree's abilities.

    More powerful than the theoretical literature is the substantial
    empirical literature--including field and laboratory experiments,
    econometrics, and surveys--that has developed since the mid-1990s to
    test the hypotheses of this model of human motivation. Across many
    different settings, researchers have found substantial evidence that,
    under some circumstances, adding money for an activity previously
    undertaken without price compensation reduces, rather than increases,
    the level of activity. The work has covered contexts as diverse as the
    willingness of employees to work more or to share their experience and
    knowledge with team members, of communities to accept locally
    undesirable land uses, or of parents to pick up children from day-care
    centers punctually. The results of this empirical literature strongly
    suggest that across various domains some displacement or crowding out
    can be identified between monetary rewards and nonmonetary motivations.
    This does not mean that offering monetary incentives does not increase
    extrinsic rewards--it does. Where extrinsic rewards dominate, this will
    increase the activity rewarded as usually predicted in economics.
    However, the effect on intrinsic motivation, at least sometimes,
    operates in the opposite direction. Where intrinsic motivation is an
    important factor because pricing and contracting are difficult to
    achieve, or because the payment that can be offered is relatively low,
    the aggregate effect may be negative. Persuading experienced employees
    to communicate their tacit knowledge to the teams they work with is a
    good example of the type of behavior that is very hard to specify for
    efficient pricing, and therefore occurs more effectively through social
    motivations for teamwork than through payments. Negative effects of
    small payments on participation in work that was otherwise
    volunteer-based are an example of low payments recruiting relatively
    few people, but making others shift their efforts elsewhere and thereby
    reducing, rather than increasing, the total level of volunteering for
    the job.

Because of the Crowding-out Effect, systems tend to work best if either
"everybody is paid" (of the people doing a certain job, e.g. contributing
bandwidth), or else "nobody is paid." You cannot have it both ways.

Best regards
	Christian

-- 
|-------- Dr. Christian Siefkes --------- christian at siefkes.net ---------
|   Homepage: http://www.siefkes.net/   |   Blog: http://www.keimform.de/
|      Peer Production in the Physical World:      http://peerconomy.org/
|------------------------------------------ OpenPGP Key ID: 0x346452D8 --
A matter of internal security: the age-old cry of the oppressor.
        -- Capt. Picard, in "Star Trek: The Next Generation"

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