Mechanism Design in Shared Infrastructures

Richard Weber, University of Cambridge

Abstract:  Infrastructure virtualization is a powerful tool towards building global computing and communication infrastructures. The idea is that multiple organizations should be incentivized to contribute resources to a network, or a computing and storage facility, such as a computational Grid.


However, it is not clear what business models can make such virtual infrastructures viable. In particular, what are the incentives for organizations to contribute resources? How should the costs be shared? How should a facility be shared once it is built?

We discuss the mechanism design problems that arise when a number of agents are invited to contribute re sources to a shared infrastructure. Each agent has private information about the value he will obtain from the facility once it is built. By analogy with ideas from optimal auction design, we find that the agents' decisions about the quantities of resource that they will wish to contribute can be greatly affected by the resource sharing policy that they know will be deployed when the facility operates. Unless this policy is well-designed (which sometimes means counterintuitively!), the agents may attempt to free-ride, or contribute less resource than is desirable. We find an optimal policy in a limit as the number of participants becomes large.