The Price of Anarchy and the Design of Scalable Resource Allocation Mechanisms
Stub. Designing simple, scalable (no full-VCG) resource-allocation mechanisms with bounded price of anarchy, via the proportional allocation mechanism and a characterization theorem, contrasted with the VCG approach. (AGT ch. 21)
Asks a mechanism-design question through a price-of-anarchy lens: when full VCG is too expensive/complex to run (e.g. bandwidth sharing at scale), can a simple mechanism like proportional allocation still guarantee a bounded efficiency loss at equilibrium? Includes a characterization theorem for which simple mechanisms achieve this, and a comparison with VCG.
Outline (TODO — flesh out each)
- The proportional allocation mechanism (Kelly mechanism)
- A characterization theorem for scalable mechanisms
- The Vickrey-Clarke-Groves approach, contrasted
- Further directions