Pairing games and markets

Pairing Games or Markets studied here are the non-two-sided NTU generalization of assignment games. We show that the Equilibrium Set is nonempty, that it is the set of stable allocations or the set of semistable allocations, and that it has has several notable structural properties. We also introduce the solution concept of pseudostable allocations and show that they are in the Demand Bargaining Set. We give a dynamic Market Procedure that reaches the Equilibrium Set in a bounded number of steps. We use elementary tools of graph theory and a representation theorem obtained here

Controlled Matching Game for Resource Allocation and User Association in WLANs

In multi-rate IEEE 802.11 WLANs, the traditional user association based on the strongest received signal and the well known anomaly of the MAC protocol can lead to overloaded Access Points (APs), and poor or heterogeneous performance. Our goal is to propose an alternative game-theoretic approach for association. We model the joint resource allocation and user association as a matching game with complementarities and peer effects consisting of selfish players solely interested in their individual throughputs. Using recent game-theoretic results we first show that various resource sharing protocols actually fall in the scope of the set of stability-inducing resource allocation schemes. The game makes an extensive use of the Nash bargaining and some of its related properties that allow to control the incentives of the players. We show that the proposed mechanism can greatly improve the efficiency of 802.11 with heterogeneous nodes and reduce the negative impact of peer effects such as its MAC anomaly. The mechanism can be implemented as a virtual connectivity management layer to achieve efficient APs-user associations without modification of the MAC layer

Matching Theory for Future Wireless Networks: Fundamentals and Applications

The emergence of novel wireless networking paradigms such as small cell and cognitive radio networks has forever transformed the way in which wireless systems are operated. In particular, the need for self-organizing solutions to manage the scarce spectral resources has become a prevalent theme in many emerging wireless systems. In this paper, the first comprehensive tutorial on the use of matching theory, a Nobelprize winning framework, for resource management in wireless networks is developed. To cater for the unique features of emerging wireless networks, a novel, wireless-oriented classification of matching theory is proposed. Then, the key solution concepts and algorithmic implementations of this framework are exposed. Then, the developed concepts are applied in three important wireless networking areas in order to demonstrate the usefulness of this analytical tool. Results show how matching theory can effectively improve the performance of resource allocation in all three applications discussed

Interchange fee rate, merchant discount rate and retail prices in a credit card network: A game-theoretic analysis

We consider two game-theoretic settings to determine the optimal values of an issuer's interchange fee rate, an acquirer's merchant discount rate, and a merchant's retail price in a credit card network. In the first setting, we investigate a two-stage game problem in which the issuer and the acquirer first negotiate the interchange fee rate, and the acquirer and the retailer then determine their merchant discount rate and retail price, respectively. In the second setting, motivated by the recent US bill “H.R. 2695,” we develop a three-player cooperative game in which the issuer, the acquirer, and the merchant form a grand coalition and bargain over the interchange fee rate and the merchant discount rate. Following the cooperative game, the retailer makes its retail pricing decision. We derive both the Shapley value- and the nucleolus-characterized, and globally-optimal unique rates for the grand coalition. Comparing the two game settings, we find that the participation of the merchant in the negotiation process can result in the reduction of both rates. Moreover, the stability of the grand coalition in the cooperative game setting may require that the merchant should delegate the credit card business only to the issuer and the acquirer with sufficiently low operation costs. We also show that the grand coalition is more likely to be stable and the U.S. bill “H.R. 2695” is thus more effective, if the degree of division of labor in the credit card network is higher as the merchant, acquirer, and issuer are more specialized in the retailing, acquiring, and issuing operations, respectively. © 2012 Wiley Periodicals, Inc. Naval Research Logistics, 201

A Survey of Models of Network Formation: Stability and Efficiency

I survey the recent literature on the formation of networks. I provide definitions of network games, a number of examples of models from the literature, and discuss some of what is known about the (in)compatibility of overall societal welfare with individual incentives to form and sever links

Sharing Non-Anonymous Costs of Multiple Resources Optimally

In cost sharing games, the existence and efficiency of pure Nash equilibria fundamentally depends on the method that is used to share the resources' costs. We consider a general class of resource allocation problems in which a set of resources is used by a heterogeneous set of selfish users. The cost of a resource is a (non-decreasing) function of the set of its users. Under the assumption that the costs of the resources are shared by uniform cost sharing protocols, i.e., protocols that use only local information of the resource's cost structure and its users to determine the cost shares, we exactly quantify the inefficiency of the resulting pure Nash equilibria. Specifically, we show tight bounds on prices of stability and anarchy for games with only submodular and only supermodular cost functions, respectively, and an asymptotically tight bound for games with arbitrary set-functions. While all our upper bounds are attained for the well-known Shapley cost sharing protocol, our lower bounds hold for arbitrary uniform cost sharing protocols and are even valid for games with anonymous costs, i.e., games in which the cost of each resource only depends on the cardinality of the set of its users

Industrial Symbiotic Relations as Cooperative Games

In this paper, we introduce a game-theoretical formulation for a specific form of collaborative industrial relations called "Industrial Symbiotic Relation (ISR) games" and provide a formal framework to model, verify, and support collaboration decisions in this new class of two-person operational games. ISR games are formalized as cooperative cost-allocation games with the aim to allocate the total ISR-related operational cost to involved industrial firms in a fair and stable manner by taking into account their contribution to the total traditional ISR-related cost. We tailor two types of allocation mechanisms using which firms can implement cost allocations that result in a collaboration that satisfies the fairness and stability properties. Moreover, while industries receive a particular ISR proposal, our introduced methodology is applicable as a managerial decision support to systematically verify the quality of the ISR in question. This is achievable by analyzing if the implemented allocation mechanism is a stable/fair allocation.Comment: Presented at the 7th International Conference on Industrial Engineering and Systems Management (IESM-2017), October 11--13, 2017, Saarbr\"ucken, German

Coreness of Cooperative Games with Truncated Submodular Profit Functions

Coreness represents solution concepts related to core in cooperative games, which captures the stability of players. Motivated by the scale effect in social networks, economics and other scenario, we study the coreness of cooperative game with truncated submodular profit functions. Specifically, the profit function $f(\cdot)$ is defined by a truncation of a submodular function $\sigma(\cdot)$: $f(\cdot)=\sigma(\cdot)$ if $\sigma(\cdot)\geq\eta$ and $f(\cdot)=0$ otherwise, where $\eta$ is a given threshold. In this paper, we study the core and three core-related concepts of truncated submodular profit cooperative game. We first prove that whether core is empty can be decided in polynomial time and an allocation in core also can be found in polynomial time when core is not empty. When core is empty, we show hardness results and approximation algorithms for computing other core-related concepts including relative least-core value, absolute least-core value and least average dissatisfaction value