The Price of Fairness
Dimitris Bertsimas, Vivek F. Farias, Nikolaos Trichakis
Operations Research · 2011 · Volume 59 · Issue 1
Abstract
In this paper we study resource allocation problems that involve multiple self-interested parties or players and a central decision maker. We introduce and study the price of fairness, which is the relative system efficiency loss under a “fair” allocation assuming that a fully efficient allocation is one that maximizes the sum of player utilities. We focus on two well-accepted, axiomatically justified notions of fairness, viz., proportional fairness and max-min fairness. For these notions we provide a tight characterization of the price of fairness for a broad family of problems.
Keywords
analysis of algorithms, games/group decisions, bargaining, programming, multiple criteria, nonlinear, applications, algorithms
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