Abstract
A two-server service network has been studied from the principal-agent perspective. In the model, services are rendered by two independent facilities coordinated by an agency, which seeks to devise a strategy to suitably allocate customers to the facilities and to simultaneously determine compensation levels. Two possible allocation schemes were compared-viz. the common queue and separate queue schemes. The separate queue allocation scheme was shown to give more competition incentives to the independent facilities and to also induce higher service capacity. In this paper, we investigate the general case of a multiple-server queueing model, and again find that the separate queue allocation scheme creates more competition incentives for servers and induces higher service capacities. In particular, if there are no severe diseconomies associated with increasing service capacity, it gives a lower expected sojourn time in equilibrium when the compensation level is sufficiently high.
Original language | English (US) |
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Pages (from-to) | 379-402 |
Number of pages | 24 |
Journal | East Asian Journal on Applied Mathematics |
Volume | 1 |
Issue number | 4 |
DOIs | |
State | Published - Nov 2011 |
Keywords
- Capacity allocation
- Competition
- Incentive theory
- Markovian queueing systems
- Nash equilibrium
- Principal agent