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Author Wang, Tao ♦ Xu, Yunjian ♦ Ahipasaoglu, Selin Damla ♦ Courcoubetis, Costas
Source IEEE Xplore Digital Library
Content type Text
Publisher Institute of Electrical and Electronics Engineers, Inc. (IEEE)
File Format PDF
Copyright Year ©2015
Language English
Subject Domain (in DDC) Technology ♦ Engineering & allied operations ♦ Other branches of engineering
Subject Keyword Bayes methods ♦ Standards ♦ Optimization ♦ Heuristic algorithms ♦ Algorithm design and analysis ♦ Energy management ♦ Terminology ♦ Biconvex optimization ♦ Mechanism design ♦ Max-min fairness ♦ Bayesian incentive compatibility ♦ Ex-post budget balance
Abstract We generalize the standard Arrow-d'Aspremont-Gerard-Varet (AGV) mechanism to balance the (ex-ante) net payoffs received by all agents, while maintaining Bayesian incentive compatibility, ex-post efficiency, and ex-post budget balance of the standard AGV mechanism. In a private-value environment with independent agents' types and the principal's cost, we show (under mild conditions) the existence of a generalized AGV mechanism that yields all agents the same ex-ante payoff. Since a generalized AGV mechanism is designed to be ex-post budget balanced, equal distribution of ex-ante social welfare immediately guarantees ex-ante individual rationality (for all agents), as long as the ex-ante social welfare is nonnegative. To mitigate the volatility of agents' ex-post payoffs, we formulate the problem of ex-post payoff variance minimization (subject to equal distribution of ex-ante net benefit) as a biconvex program. We propose an effective heuristic algorithm to solve this (non-convex) optimization problem. Finally, we apply the constructed theoretic framework to a case study on market design for energy management in shared spaces.
Description Author affiliation: Engineering Systems and Design pillar, Singapore University of Technology and Design, Singapore (Wang, Tao; Xu, Yunjian; Ahipasaoglu, Selin Damla; Courcoubetis, Costas)
Educational Role Student ♦ Teacher
Age Range above 22 year
Educational Use Research ♦ Reading
Education Level UG and PG
Learning Resource Type Article
Publisher Date 2015-12-15
Publisher Place Japan
Rights Holder Institute of Electrical and Electronics Engineers, Inc. (IEEE)
e-ISBN 9781479978861
Size (in Bytes) 355.94 kB
Page Count 8
Starting Page 5170
Ending Page 5177

Source: IEEE Xplore Digital Library