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Alternative Mothods for Cost Allocation in Stochastic Service Systems

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  • McLean, R.
  • Sharkey, W.W.

Abstract

In this paper we consider the question of allocating costs and setting prices for customers in a variety of queuing systems. We will focus on the problem of setting users fees within an organization for a shared resource, such as a computer center. We argue that both the Aumann-Shapley pricing rule, and a pricing rule based on the Shapley value of a finite game, are appropriate cost allocation methodologies. These approaches allow us to explicitly determine prices for customers in a queuing situation, who differ from one another in terms of their arrival rates, service rates, costs of lost work, and the number of simultaneous servers which they require.
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Suggested Citation

  • McLean, R. & Sharkey, W.W., 1992. "Alternative Mothods for Cost Allocation in Stochastic Service Systems," Papers 81, Bell Communications - Economic Research Group.
    • Handle: RePEc:fth:bellco:81
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    Cited by:

    1. Moulin, Herve, 1995. "On Additive Methods to Share Joint Costs," Mathematical Social Sciences, Elsevier, vol. 30(1), pages 98-99, August.
    2. Sprumont, Yves, 1998. "Ordinal Cost Sharing," Journal of Economic Theory, Elsevier, vol. 81(1), pages 126-162, July.

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    Keywords

    prices ; economic models;

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