Coordination in hierarchical systems with rational agents

Michał Karpowicz

Abstract

This dissertation addresses the problem of coordination in hierarchical systems, where scarce resources must be efficiently allocated to strategically interdependent and rational agents. We address the following theoretical question: what are the necessary and sufficient conditions for efficiency of outcomes in the games defined by the resource allocation mechanisms in hierarchical systems with rational agents? The question is examined in the context of problems arising in the field of communication networks and power systems, as well as in the area of market regulation. Examples include: network interconnection management, bandwidth and spectrum allocation, electronic procurement, power supply, share allocation, etc. From the engineering point of view we analyze the optimality conditions for concave optimization problems with implicit constraints and apply them to design methods of decomposition and coordination. From viewpoint of microeconomic theory we address the problem of providing theoretical recommendations that may support the design of market regulation rules which make the invisible hand of the market work. We make the following contributions. First, we describe the mechanism design problem in terms of the multiple-criteria decision analysis related to development of coordination algorithms for hierarchical systems with rational and interdependent agents. Second, we characterize the uniform-price market-clearing mechanisms from viewpoint of the efficiency of (pure strategy) Nash equilibria arising in the corresponding resource allocation games. Finally, we establish the necessary and sufficient conditions for Pareto-optimality of allocations in (pure strategy) Nash equilibria of the games defined by the mechanisms allocating a single divisible resource to the rational agents interacting on the demand and supply side of the system.
Diploma typeDoctor of Philosophy
Author Michał Karpowicz (FEIT / AK)
Michał Karpowicz,,
- The Institute of Control and Computation Engineering
Title in EnglishCoordination in hierarchical systems with rational agents
Languageen angielski
Certifying UnitFaculty of Electronics and Information Technology (FEIT)
Disciplineinformation science / (technology domain) / (technological sciences)
Start date23-01-2007
Defense Date05-01-2010
End date26-01-2010
Supervisor Krzysztof Malinowski (FEIT / AK)
Krzysztof Malinowski,,
- The Institute of Control and Computation Engineering

Internal reviewers Andrzej Wierzbicki (FEIT / AK)
Andrzej Wierzbicki,,
- The Institute of Control and Computation Engineering
External reviewers Ignacy Kaliszewski
Ignacy Kaliszewski,,
-
Pages204
Keywords in Englishxxx
Abstract in EnglishThis dissertation addresses the problem of coordination in hierarchical systems, where scarce resources must be efficiently allocated to strategically interdependent and rational agents. We address the following theoretical question: what are the necessary and sufficient conditions for efficiency of outcomes in the games defined by the resource allocation mechanisms in hierarchical systems with rational agents? The question is examined in the context of problems arising in the field of communication networks and power systems, as well as in the area of market regulation. Examples include: network interconnection management, bandwidth and spectrum allocation, electronic procurement, power supply, share allocation, etc. From the engineering point of view we analyze the optimality conditions for concave optimization problems with implicit constraints and apply them to design methods of decomposition and coordination. From viewpoint of microeconomic theory we address the problem of providing theoretical recommendations that may support the design of market regulation rules which make the invisible hand of the market work. We make the following contributions. First, we describe the mechanism design problem in terms of the multiple-criteria decision analysis related to development of coordination algorithms for hierarchical systems with rational and interdependent agents. Second, we characterize the uniform-price market-clearing mechanisms from viewpoint of the efficiency of (pure strategy) Nash equilibria arising in the corresponding resource allocation games. Finally, we establish the necessary and sufficient conditions for Pareto-optimality of allocations in (pure strategy) Nash equilibria of the games defined by the mechanisms allocating a single divisible resource to the rational agents interacting on the demand and supply side of the system.
Thesis file
Karpowicz.pdf 2.89 MB

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