IDEAS home Printed from https://ideas.repec.org/a/gam/jgames/v10y2019i2p17-d219586.html
   My bibliography  Save this article

Routing-Proofness in Congestion-Prone Networks

Author

Listed:
  • Ruben Juarez

    (Department of Economics, University of Hawaii, 2424 Maile Way, Saunders Hall 542, Honolulu, HI 96822, USA)

  • Michael Wu

    (Department of Economics, University of Hawaii, 2424 Maile Way, Saunders Hall 542, Honolulu, HI 96822, USA)

Abstract

We consider the problem of sharing the cost of connecting a large number of atomless agents in a network. The centralized agency elicits the target nodes that agents want to connect, and charges agents based on their demands. We look for a cost-sharing mechanism that satisfies three desirable properties: efficiency which charges agents based on the minimum total cost of connecting them in a network, stand-alone core stability which requires charging agents not more than the cost of connecting by themselves directly, and limit routing-proofness which prevents agents from profitable reporting as several agents connecting from A to C to B instead of A to B. We show that these three properties are not always compatible for any set of cost functions and demands. However, when these properties are compatible, a new egalitarian mechanism is shown to satisfy them. When the properties are not compatible, we find a rule that meets stand-alone core stability, limit routing-proofness and minimizes the budget deficit.

Suggested Citation

  • Ruben Juarez & Michael Wu, 2019. "Routing-Proofness in Congestion-Prone Networks," Games, MDPI, vol. 10(2), pages 1-18, April.
    • Handle: RePEc:gam:jgames:v:10:y:2019:i:2:p:17-:d:219586
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2073-4336/10/2/17/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2073-4336/10/2/17/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Sprumont, Yves, 1991. "The Division Problem with Single-Peaked Preferences: A Characterization of the Uniform Allocation Rule," Econometrica, Econometric Society, vol. 59(2), pages 509-519, March.
    2. Dominique Henriet & Herve' Moulin, 1996. "Traffic-Based Cost Allocation in a Network," RAND Journal of Economics, The RAND Corporation, vol. 27(2), pages 332-345, Summer.
    3. Juarez, Ruben, 2013. "Group strategyproof cost sharing: The role of indifferences," Games and Economic Behavior, Elsevier, vol. 82(C), pages 218-239.
    4. Jens Leth Hougaard, 2009. "An Introduction to Allocation Rules," Springer Books, Springer, number 978-3-642-01828-2, June.
    5. Juarez, Ruben & Ko, Chiu Yu & Xue, Jingyi, 2018. "Sharing sequential values in a network," Journal of Economic Theory, Elsevier, vol. 177(C), pages 734-779.
    6. Hougaard, Jens Leth & Moreno-Ternero, Juan D. & Tvede, Mich & Østerdal, Lars Peter, 2017. "Sharing the proceeds from a hierarchical venture," Games and Economic Behavior, Elsevier, vol. 102(C), pages 98-110.
    7. Dutta, Bhaskar & Mishra, Debasis, 2012. "Minimum cost arborescences," Games and Economic Behavior, Elsevier, vol. 74(1), pages 120-143.
    8. Han, Lining & Juarez, Ruben, 2018. "Free intermediation in resource transmission," Games and Economic Behavior, Elsevier, vol. 111(C), pages 75-84.
    9. Ruben Juarez & Rajnish Kumar, 2013. "Implementing efficient graphs in connection networks," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 54(2), pages 359-403, October.
    10. Kumar, Rajnish, 2013. "Secure implementation in production economies," Mathematical Social Sciences, Elsevier, vol. 66(3), pages 372-378.
    11. Hervé Moulin, 2013. "Cost Sharing In Networks: Some Open Questions," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 15(02), pages 1-10.
    12. Anna Bogomolnaia & Ron Holzman & Hervé Moulin, 2010. "Sharing the Cost of a Capacity Network," Mathematics of Operations Research, INFORMS, vol. 35(1), pages 173-192, February.
    13. Moulin, Herve & Laigret, Francois, 2011. "Equal-need sharing of a network under connectivity constraints," Games and Economic Behavior, Elsevier, vol. 72(1), pages 314-320, May.
    14. Hougaard, Jens Leth & Tvede, Mich, 2015. "Minimum cost connection networks: Truth-telling and implementation," Journal of Economic Theory, Elsevier, vol. 157(C), pages 76-99.
    15. Hougaard, Jens Leth & Tvede, Mich, 2012. "Truth-telling and Nash equilibria in minimum cost spanning tree models," European Journal of Operational Research, Elsevier, vol. 222(3), pages 566-570.
    16. Dong, Baomin & Guo, Guixia & Wang, Yuntong, 2012. "Highway toll pricing," European Journal of Operational Research, Elsevier, vol. 220(3), pages 744-751.
    17. Emerson Melo, 2011. "Congestion Pricing and Learning in Traffic Network Games," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 13(3), pages 351-367, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Teresa Estañ & Natividad Llorca & Ricardo Martínez & Joaquín Sánchez-Soriano, 2021. "On how to allocate the fixed cost of transport systems," Annals of Operations Research, Springer, vol. 301(1), pages 81-105, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Juarez, Ruben & Ko, Chiu Yu & Xue, Jingyi, 2018. "Sharing sequential values in a network," Journal of Economic Theory, Elsevier, vol. 177(C), pages 734-779.
    2. Juarez, Ruben & Nitta, Kohei & Vargas, Miguel, 2021. "Coalitional efficient profit-sharing," Economics Letters, Elsevier, vol. 204(C).
    3. Han, Lining & Juarez, Ruben, 2018. "Free intermediation in resource transmission," Games and Economic Behavior, Elsevier, vol. 111(C), pages 75-84.
    4. Kristal K. Trejo & Ruben Juarez & Julio B. Clempner & Alexander S. Poznyak, 2023. "Non-Cooperative Bargaining with Unsophisticated Agents," Computational Economics, Springer;Society for Computational Economics, vol. 61(3), pages 937-974, March.
    5. Hougaard, Jens Leth & Kronborg, Dorte & Smilgins, Aleksandrs, 2017. "Fair division of costs in green energy markets," Energy, Elsevier, vol. 139(C), pages 220-230.
    6. Hougaard, Jens Leth & Tvede, Mich, 2022. "Trouble comes in threes: Core stability in minimum cost connection networks," European Journal of Operational Research, Elsevier, vol. 297(1), pages 319-324.
    7. Ruben Juarez & Kohei Nitta & Miguel Vargas, 2020. "Profit-sharing and efficient time allocation," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 70(3), pages 817-846, October.
    8. Jens Leth Hougaard & Mich Tvede, 2020. "Trouble Comes in Threes: Core stability in Minimum Cost Connection Networks," IFRO Working Paper 2020/07, University of Copenhagen, Department of Food and Resource Economics.
    9. Bergantiños, Gustavo & Martínez, Ricardo, 2014. "Cost allocation in asymmetric trees," European Journal of Operational Research, Elsevier, vol. 237(3), pages 975-987.
    10. Jens Leth Hougaard & Mich Tvede, 2020. "Implementation of Optimal Connection Networks," IFRO Working Paper 2020/06, University of Copenhagen, Department of Food and Resource Economics.
    11. Moulin, Hervé, 2014. "Pricing traffic in a spanning network," Games and Economic Behavior, Elsevier, vol. 86(C), pages 475-490.
    12. Ruben Juarez & Rajnish Kumar, 2013. "Implementing efficient graphs in connection networks," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 54(2), pages 359-403, October.
    13. Jens Leth Hougaard & Hervé Moulin, 2018. "Sharing the cost of risky projects," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 65(3), pages 663-679, May.
    14. Jung S. You & Ruben Juarez, 2021. "Incentive-compatible simple mechanisms," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 71(4), pages 1569-1589, June.
    15. Isabel Amigo & Pablo Belzarena & Sandrine Vaton, 2016. "Revenue sharing in network utility maximization problems," Netnomics, Springer, vol. 17(3), pages 255-284, November.
    16. Gildas Sédry Fopa & Issofa Moyouwou & Joseph Siani, 2022. "Axiomatization of the counting rule for cost-sharing with possibly redundant items," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 58(3), pages 567-587, April.
    17. Hernández, Penélope & Peris, Josep E. & Vidal-Puga, Juan, 2023. "A non-cooperative approach to the folk rule in minimum cost spanning tree problems," European Journal of Operational Research, Elsevier, vol. 307(2), pages 922-928.
    18. Hougaard, Jens Leth & Moulin, Hervé, 2014. "Sharing the cost of redundant items," Games and Economic Behavior, Elsevier, vol. 87(C), pages 339-352.
    19. Munich, Léa, 2024. "Schedule situations and their cooperative game theoretic representations," European Journal of Operational Research, Elsevier, vol. 316(2), pages 767-778.
    20. Hougaard, Jens Leth & Tvede, Mich, 2015. "Minimum cost connection networks: Truth-telling and implementation," Journal of Economic Theory, Elsevier, vol. 157(C), pages 76-99.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jgames:v:10:y:2019:i:2:p:17-:d:219586. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.