Incentivizing Behavior in Transportation Networks with Non-Rational Drivers and 3rd-party Economic Agents

A social planner who wishes to influence human decision-making must shape incentives to account for non-rational decision-making biases among the population to be influenced. However, the planner does not operate in a vacuum; societies are comprised of many heterogeneous economic actors whose self-interested behavior may hamper the social planner's ability to achieve their goals. For instance, in a transportation network which is subject to road tolls, a 3rd-party economic agent (whom we call the arbitrageur) may launch a service to provide users with information which helps them optimize their toll pricing and congestion experiences. What are the effects of such an arbitrageur on the social planner's incentive design problem? Do there still exist behavior-optimizing incentive schemes in the presence of an arbitrageur? In this work, our contributions are a formal model of this scenario and analytical derivations of game-theoretic equilibria for a simple transportation network.