Economic issues in shared infrastructures

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Economic issues in shared infrastructures
We define some interesting incentive issues that arise in the management of virtual infrastructures. We demonstrate that participants’ decisions about the quantities of infrastructure that they will choose to contribute to a virtual organization can be greatly affected by the resource sharing policy that they know will be deployed when the system operates. Unless this policy is well-designed, agents will attempt to free-ride by contributing less resource than is desirable. Our novel contribution is the formulation of models for designing optimal management policies, an analysis that demonstrates the inadequacy of simple sharing policies, and proposals for some better ones. We find an optimal policy in a limit as the number of participants becomes large. We learn that simple policies may be far from optimal and that efficient policy design is not trivial; policy parameters play important role in optimizing the efficiency of virtual facility formation. Categories and Subject Descri...
Costas Courcoubetis, Richard R. Weber
Added 28 May 2010
Updated 28 May 2010
Type Conference
Year 2009
Authors Costas Courcoubetis, Richard R. Weber
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