Nash Equilibrium Design and Optimization

The general problem of Nash equilibrium design is investigated from an optimization perspective. Within this context, a specific but fairly broad class of noncooperative games are considered that have been applied to a variety of settings including network congestion control, wireless uplink power control, and optical power control. The Nash equilibrium design problem is analyzed under various knowledge assumptions (full versus limited information) and design objectives (QoS versus utility maximization). Among other results, the "price of anarchy" is shown not to be an inherent feature of games that incorporate pricing mechanisms, but merely a misconception that often stems from arbitrary choice of game parameters. Moreover, a simple linear pricing is sufficient for design of Nash equilibrium according to a chosen global objective for a general class of games and under suitable information assumptions.