A Fairness-aware Incentive Scheme for Federated Learning

In federated learning (FL), data owners "share" their local data in a privacy preserving manner in order to build a federated model, which in turn, can be used to generate revenues for the participants. However, in FL involving business participants, they might incur significant costs if several competitors join the same federation. Furthermore, the training and commercialization of the models will take time, resulting in delays before the federation accumulates enough budget to pay back the participants. The issues of costs and temporary mismatch between contributions and rewards have not been addressed by existing payoff-sharing schemes. In this paper, we propose the Federated Learning Incentivizer (FLI) payoff-sharing scheme. The scheme dynamically divides a given budget in a context-aware manner among data owners in a federation by jointly maximizing the collective utility while minimizing the inequality among the data owners, in terms of the payoff gained by them and the waiting time for receiving payoffs. Extensive experimental comparisons with five state-of-the-art payoff-sharing schemes show that FLI is the most attractive to high quality data owners and achieves the highest expected revenue for a data federation.