Stability of service under time-of-use pricing

DOI10.1145/3055399.3055455zbMATH Open1369.90040arXiv1704.02364OpenAlexW2583876468MaRDI QIDQ4977971FDOQ4977971

Authors: Shuchi Chawla, Nikhil R. Devanur, A. E. Holroyd, Anna R. Karlin, Balasubramanian Sivan, James Martin 

Publication date: 17 August 2017

Published in: Proceedings of the 49th Annual ACM SIGACT Symposium on Theory of Computing (Search for Journal in Brave)

Abstract: We consider "time-of-use" pricing as a technique for matching supply and demand of temporal resources with the goal of maximizing social welfare. Relevant examples include energy, computing resources on a cloud computing platform, and charging stations for electric vehicles, among many others. A client/job in this setting has a window of time during which he needs service, and a particular value for obtaining it. We assume a stochastic model for demand, where each job materializes with some probability via an independent Bernoulli trial. Given a per-time-unit pricing of resources, any realized job will first try to get served by the cheapest available resource in its window and, failing that, will try to find service at the next cheapest available resource, and so on. Thus, the natural stochastic fluctuations in demand have the potential to lead to cascading overload events. Our main result shows that setting prices so as to optimally handle the {em expected} demand works well: with high probability, when the actual demand is instantiated, the system is stable and the expected value of the jobs served is very close to that of the optimal offline algorithm.

Full work available at URL: https://arxiv.org/abs/1704.02364

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zbMATH Keywords

queueing theoryonline matchingposted pricing

Mathematics Subject Classification ID

Queues and service in operations research (90B22) Microeconomic theory (price theory and economic markets) (91B24)

Cited In (6)

• Time-of-use scheduling problem with equal-length jobs
• Preemptible queues with advance reservations: strategic behavior and revenue management
• Discrete-time cost analysis for a telecommunication billing application with rejuvenation
• Job scheduling under time-of-use energy tariffs for sustainable manufacturing: a survey
• Optimal introduction of time-of-day tariffs in the presence of consumer adjustment costs
• Scheduling with time-of-use costs

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