Stochastic Budget Optimization in Internet Advertising

Internet advertising is a sophisticated game in which the many advertisers "play" to optimize their return on investment. There are many "targets" for the advertisements, and each "target" has a collection of games with a potentially different set of players involved. In this paper, we study the problem of how advertisers allocate their budget across these "targets". In particular, we focus on formulating their best response strategy as an optimization problem. Advertisers have a set of keywords ("targets") and some stochastic information about the future, namely a probability distribution over scenarios of cost vs click combinations. This summarizes the potential states of the world assuming that the strategies of other players are fixed. Then, the best response can be abstracted as stochastic budget optimization problems to figure out how to spread a given budget across these keywords to maximize the expected number of clicks. We present the first known non-trivial poly-logarithmic approximation for these problems as well as the first known hardness results of getting better than logarithmic approximation ratios in the various parameters involved. We also identify several special cases of these problems of practical interest, such as with fixed number of scenarios or with polynomial-sized parameters related to cost, which are solvable either in polynomial time or with improved approximation ratios. Stochastic budget optimization with scenarios has sophisticated technical structure. Our approximation and hardness results come from relating these problems to a special type of (0/1, bipartite) quadratic programs inherent in them. Our research answers some open problems raised by the authors in (Stochastic Models for Budget Optimization in Search-Based Advertising, Algorithmica, 58 (4), 1022-1044, 2010).Comment: FINAL versio

On the sum-of-squares degree of symmetric quadratic functions

We study how well functions over the boolean hypercube of the form $f_k(x)=(|x|-k)(|x|-k-1)$ can be approximated by sums of squares of low-degree polynomials, obtaining good bounds for the case of approximation in $\ell_{\infty}$-norm as well as in $\ell_1$-norm. We describe three complexity-theoretic applications: (1) a proof that the recent breakthrough lower bound of Lee, Raghavendra, and Steurer on the positive semidefinite extension complexity of the correlation and TSP polytopes cannot be improved further by showing better sum-of-squares degree lower bounds on $\ell_1$-approximation of $f_k$; (2) a proof that Grigoriev's lower bound on the degree of Positivstellensatz refutations for the knapsack problem is optimal, answering an open question from his work; (3) bounds on the query complexity of quantum algorithms whose expected output approximates such functions.Comment: 33 pages. Second version fixes some typos and adds reference

On Semantic Word Cloud Representation

We study the problem of computing semantic-preserving word clouds in which semantically related words are close to each other. While several heuristic approaches have been described in the literature, we formalize the underlying geometric algorithm problem: Word Rectangle Adjacency Contact (WRAC). In this model each word is associated with rectangle with fixed dimensions, and the goal is to represent semantically related words by ensuring that the two corresponding rectangles touch. We design and analyze efficient polynomial-time algorithms for some variants of the WRAC problem, show that several general variants are NP-hard, and describe a number of approximation algorithms. Finally, we experimentally demonstrate that our theoretically-sound algorithms outperform the early heuristics

Ising formulations of many NP problems

We provide Ising formulations for many NP-complete and NP-hard problems, including all of Karp's 21 NP-complete problems. This collects and extends mappings to the Ising model from partitioning, covering and satisfiability. In each case, the required number of spins is at most cubic in the size of the problem. This work may be useful in designing adiabatic quantum optimization algorithms.Comment: 27 pages; v2: substantial revision to intro/conclusion, many more references; v3: substantial revision and extension, to-be-published versio

Algorithm Engineering in Robust Optimization

Robust optimization is a young and emerging field of research having received a considerable increase of interest over the last decade. In this paper, we argue that the the algorithm engineering methodology fits very well to the field of robust optimization and yields a rewarding new perspective on both the current state of research and open research directions. To this end we go through the algorithm engineering cycle of design and analysis of concepts, development and implementation of algorithms, and theoretical and experimental evaluation. We show that many ideas of algorithm engineering have already been applied in publications on robust optimization. Most work on robust optimization is devoted to analysis of the concepts and the development of algorithms, some papers deal with the evaluation of a particular concept in case studies, and work on comparison of concepts just starts. What is still a drawback in many papers on robustness is the missing link to include the results of the experiments again in the design