Congestion pricing by priority auction


This paper analyzes a communication network facing users with a continuous distribution of delay cost per unit time. Priority queueing is often used as a way to provide differential services for users with different delay sensitivities. Delay is a key dimension of network service quality, so priority is a valuable resource which is limited and should to be optimally allocated. We investigate the allocation of priority in queues via a simple bidding mechanism. In our mechanism, arriving users can decide not to enter the network at all or submit an announced delay sensitive value. User entering the network obtains priority over all users who make lower bids, and is charged by a payment function which is designed following an exclusion compensation principle. The payment function is proved to be incentive compatible, so the equilibrium bidding behavior leads to the implementation of "cµ-rule". Social warfare or revenue maximizing by appropriately setting the reserve payment is also analyzed.

Publication DOI:
Divisions: College of Engineering & Physical Sciences > Adaptive communications networks research group
Additional Information: Zhang, G., He, J., Ma, Y., Cheng, W., & Yang, Z. "Congestion pricing by priority auction", Network architectures, management, and applications II, Yoo, S. J. B., Chang, G-K., Li, G., & Cheung, K. (Eds.), 5626, 1421-1428, (2005). Copyright 2005 Society of Photo-Optical Instrumentation Engineers. One print or electronic copy may be made for personal use only. Systematic reproduction and distribution, duplication of any material in this paper for a fee or for commercial purposes, or modification of the content of the paper are prohibited.
Event Title: Network architectures, management, and applications II
Event Type: Other
Event Dates: 2004-11-07
Last Modified: 04 Jan 2024 08:32
Date Deposited: 01 Oct 2013 09:06
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http://proceedi ... ticleid=1321015 (Publisher URL)
PURE Output Type: Conference contribution
Published Date: 2005
Authors: Zhang, Guanxiang
He, Jianhua (ORCID Profile 0000-0002-5738-8507)
Ma, Yajie
Cheng, Wenqing
Yang, Zongkai



Version: Published Version

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