Contract Theory Based Incentive Mechanism for Clustered Vehicular Federated Learning

Clustered Vehicular Federated Learning (CVFL) can be used to improve traffic safety, increase traffic efficiency, and reduce vehicle carbon emissions. Therefore, it is extremely promising in intelligent transportation systems. However, in practice, it is difficult to accurately cluster vehicular clients with mobility according to data distribution. In addition, vehicular clients may be reluctant to contribute their computation and communication resources to perform learning tasks if the CVFL server does not give them proper incentives. In this paper, we would like to address the above issues. Specifically, considering the mobility of vehicular clients, we first propose a clustering method to cluster vehicular clients into several clusters based on the cosine similarity between the model gradient of local vehicular clients and the K-means method. Then, we design a set of optimal contracts specifically for the clusters, aiming to motivate them to select the optimal number of intra-cluster iterations for model training and give the closed-form solution to the contracts under the constraints of individual rationality, incentive compatibility, and task accuracy. The proposed contract theory based incentive mechanism not only effectively motivates every cluster, but also overcomes the information asymmetry problem to maximize the utility of the CVFL server. Finally, simulation results validate the effectiveness of the proposed clustering method and the designed contract.