This paper discusses distributed resource allocation in a communication system. Some recent approaches to decentralized resource allocation in a communication system are summarized. A characterization for resource control and pricing in a distributed wireless network with transmit power control is presented.
Power control is modelled as a noncooperative externality game between the users. In the absence of a price each user has the incentive to increase the transmit power to increase the quality-of service as measured by the signal-to-noise ratio. However, the increase in transmission energy of a representative user by definition deteriorates the signal-to-noise ratio for all other users, thus imposing an externality cost. The Nash equilibrium in an uncontrolled distributed network is one where the system fails due to excessive congestion. However, by introducing a simple linear pricing penalty, the distributed system can be made to achieve the Pareto-optimal quality of service.
Convergence to an efficient Nash equilibrium under pricing is observed in a numerical example assuming that the
users apply a standard learning automaton.
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