Locally Stable Marriage with Strict Preferences

We study stable matching problems with locality of information and control. In our model, each agent is a node in a fixed network and strives to be matched to another agent. An agent has a complete preference list over all other agents it can be matched with. Agents can match arbitrarily, and they learn about possible partners dynamically based on their current neighborhood. We consider convergence of dynamics to locally stable matchings -- states that are stable with respect to their imposed information structure in the network. In the two-sided case of stable marriage in which existence is guaranteed, we show that the existence of a path to stability becomes NP-hard to decide. This holds even when the network exists only among one partition of agents. In contrast, if one partition has no network and agents remember a previous match every round, a path to stability is guaranteed and random dynamics converge with probability 1. We characterize this positive result in various ways. For instance, it holds for random memory and for cache memory with the most recent partner, but not for cache memory with the best partner. Also, it is crucial which partition of the agents has memory. Finally, we present results for centralized computation of locally stable matchings, i.e., computing maximum locally stable matchings in the two-sided case and deciding existence in the roommates case.Comment: Conference version in ICALP 2013; to appear in SIAM J. Disc Mat

Stackelberg Network Pricing Games

We study a multi-player one-round game termed Stackelberg Network Pricing Game, in which a leader can set prices for a subset of $m$ priceable edges in a graph. The other edges have a fixed cost. Based on the leader's decision one or more followers optimize a polynomial-time solvable combinatorial minimization problem and choose a minimum cost solution satisfying their requirements based on the fixed costs and the leader's prices. The leader receives as revenue the total amount of prices paid by the followers for priceable edges in their solutions, and the problem is to find revenue maximizing prices. Our model extends several known pricing problems, including single-minded and unit-demand pricing, as well as Stackelberg pricing for certain follower problems like shortest path or minimum spanning tree. Our first main result is a tight analysis of a single-price algorithm for the single follower game, which provides a $(1+\epsilon) \log m$-approximation for any $\epsilon >0$. This can be extended to provide a $(1+\epsilon)(\log k + \log m)$-approximation for the general problem and $k$ followers. The latter result is essentially best possible, as the problem is shown to be hard to approximate within \mathcal{O(\log^\epsilon k + \log^\epsilon m). If followers have demands, the single-price algorithm provides a $(1+\epsilon)m^2$-approximation, and the problem is hard to approximate within \mathcal{O(m^\epsilon) for some $\epsilon >0$. Our second main result is a polynomial time algorithm for revenue maximization in the special case of Stackelberg bipartite vertex cover, which is based on non-trivial max-flow and LP-duality techniques. Our results can be extended to provide constant-factor approximations for any constant number of followers

Ascending-Price Algorithms for Unknown Markets

We design a simple ascending-price algorithm to compute a $(1+\varepsilon)$-approximate equilibrium in Arrow-Debreu exchange markets with weak gross substitute (WGS) property, which runs in time polynomial in market parameters and $\log 1/\varepsilon$. This is the first polynomial-time algorithm for most of the known tractable classes of Arrow-Debreu markets, which is easy to implement and avoids heavy machinery such as the ellipsoid method. In addition, our algorithm can be applied in unknown market setting without exact knowledge about the number of agents, their individual utilities and endowments. Instead, our algorithm only relies on queries to a global demand oracle by posting prices and receiving aggregate demand for goods as feedback. When demands are real-valued functions of prices, the oracles can only return values of bounded precision based on real utility functions. Due to this more realistic assumption, precision and representation of prices and demands become a major technical challenge, and we develop new tools and insights that may be of independent interest. Furthermore, our approach also gives the first polynomial-time algorithm to compute an exact equilibrium for markets with spending constraint utilities, a piecewise linear concave generalization of linear utilities. This resolves an open problem posed by Duan and Mehlhorn (2015).Comment: 33 page

Strategic Payments in Financial Networks

In their seminal work on systemic risk in financial markets, Eisenberg and Noe [Larry Eisenberg and Thomas Noe, 2001] proposed and studied a model with n firms embedded into a network of debt relations. We analyze this model from a game-theoretic point of view. Every firm is a rational agent in a directed graph that has an incentive to allocate payments in order to clear as much of its debt as possible. Each edge is weighted and describes a liability between the firms. We consider several variants of the game that differ in the permissible payment strategies. We study the existence and computational complexity of pure Nash and strong equilibria, and we provide bounds on the (strong) prices of anarchy and stability for a natural notion of social welfare. Our results highlight the power of financial regulation - if payments of insolvent firms can be centrally assigned, a socially optimal strong equilibrium can be found in polynomial time. In contrast, worst-case strong equilibria can be a factor of ?(n) away from optimal, and, in general, computing a best response is an NP-hard problem. For less permissible sets of strategies, we show that pure equilibria might not exist, and deciding their existence as well as computing them if they exist constitute NP-hard problems

Jamming-Resistant Learning in Wireless Networks

We consider capacity maximization in wireless networks under adversarial interference conditions. There are n links, each consisting of a sender and a receiver, which repeatedly try to perform a successful transmission. In each time step, the success of attempted transmissions depends on interference conditions, which are captured by an interference model (e.g. the SINR model). Additionally, an adversarial jammer can render a (1-delta)-fraction of time steps unsuccessful. For this scenario, we analyze a framework for distributed learning algorithms to maximize the number of successful transmissions. Our main result is an algorithm based on no-regret learning converging to an O(1/delta)-approximation. It provides even a constant-factor approximation when the jammer exactly blocks a (1-delta)-fraction of time steps. In addition, we consider a stochastic jammer, for which we obtain a constant-factor approximation after a polynomial number of time steps. We also consider more general settings, in which links arrive and depart dynamically, and where each sender tries to reach multiple receivers. Our algorithms perform favorably in simulations.Comment: 22 pages, 2 figures, typos remove

Computing Equilibria in Markets with Budget-Additive Utilities

We present the first analysis of Fisher markets with buyers that have budget-additive utility functions. Budget-additive utilities are elementary concave functions with numerous applications in online adword markets and revenue optimization problems. They extend the standard case of linear utilities and have been studied in a variety of other market models. In contrast to the frequently studied CES utilities, they have a global satiation point which can imply multiple market equilibria with quite different characteristics. Our main result is an efficient combinatorial algorithm to compute a market equilibrium with a Pareto-optimal allocation of goods. It relies on a new descending-price approach and, as a special case, also implies a novel combinatorial algorithm for computing a market equilibrium in linear Fisher markets. We complement these positive results with a number of hardness results for related computational questions. We prove that it is NP-hard to compute a market equilibrium that maximizes social welfare, and it is PPAD-hard to find any market equilibrium with utility functions with separate satiation points for each buyer and each good.Comment: 21 page