According to Wardrop's first principle, agents in a congested network choose their routes selfishly, a behavior that is captured by the Nash equilibrium of the underlying noncooperative game. A Nash equilibrium does not optimize any global criterion per se, and so there is no apparent reason why...

The design of route-guidance systems faces a well-known dilemma. The approach that theoretically yields the system-optimal traffic pattern may discriminate against some users, for the sake of favoring others. Proposed alternate models, however, do not directly address the system perspective and...

We present a short, geometric proof for the price-of-anarchy results that have recently been established in a series of papers on selfish routing in multicommodity flow networks and on nonatomic congestion games. This novel proof also facilitates two new types of theoretical results: On the one...

We study the problem of minimizing the maximum latency of flows in networks with congestion. We show that this problem is NP-hard, even when all arc latency functions are linear and there is a single source and sink. Still, an optimal flow and an equilibrium flow share a desirable property in...

This paper develops a game theoretic model based on a two-sided market framework to investigate the net neutrality debate. In particular, we consider investment incentives of Internet Service Providers (ISPs) under a neutral and non-neutral network regimes. In our model, two interconnected ISPs...

We consider network games with atomic players, which indicates that some players control a positive amount of flow. Instead of studying Nash equilibria as previous work has done, we consider that players with considerable market power will make decisions before the others because they can...

The zero-sum fallacy claims that lack of cooperation may result from the belief that resources are fixed even when they are not. While the economic theory community has previously studied this fallacy, often focusing in poverty, unemployment, retirement, and immigration, it remains unknown...

This article studies a principal-agent problem with discrete outcome and effort level spaces. The principal and the agent are risk neutral and the latter is subject to limited liability. We consider the ratio between the first-best social welfare and the social welfare arising from the...

In the traffic assignment problem, commuters select the shortest available path to travel from a given origin to a given destination. This system has been studied for over 50 years since Wardrop's seminal work. Motivated by freight companies, which need to ship goods across the network, we study...

Bilateral investment treaties (BITs) are agreements between two countries for the reciprocal encouragement, promotion and protection of investments in each other's territories by companies based in either country. Germany and Pakistan signed the first BIT in 1959 and since then, BITs are one of...