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4.1
Layered Graphs and Mechanisms for Network Flow
Consider a self-interested network flow problem in a layered graph. If each agent
truthfully declares its subset of edges, the mechanism can easily compute f ( θ )
by running a maximal flow algorithm, such as the Edmonds-Karp algorithm.
Proof. Suppose the mechanism chooses a flow f . The total flow exiting s ends
up in vertices in L 1 .Alltheflowfrom L 1 ends up in vertices in L 2 ,andsoon.
Since flow may only go through edges owned by some agent, the total utility
obtained by the flow f is
f + ( e )=
f + ( u, v )+ ... +
f + ( u, v )=
|
f
|
+ ... +
|
f
|
=( n
1)
|
f
e∈E
u∈L 1 ,v∈L 2
u∈L n− 1 ,v∈L n
(6)
A naive mechanism for the self-interested flow problem, with no payments to
the mechanism, is not strategy-proof. An agent may declare only a subset of the
edges it controls, to change the flow that the mechanism chooses to a flow that
the agent values more. Figure 1 shows two agents on a certain network flow ( A 1
and A 2 ). A 1 's edges are marked with dashed lines, and A 2 's edges are marked
with full lines. A 2 truthfully declares all its edges. Assuming the mechanism
favors A 1 and chooses the specific maximal that maximizes A 1 's utility among
all maximal flows, A 1 can do better by not declaring its topmost edge ( v 1 ,v 4 ),
gaining a utility of 2 instead of 1.
Fig. 1. Manipulations in self-interested flow problems
5
A Mechanism for the Self-interested Network Flow
Problem
We assume quasi-linear utility. Each agent pays the mechanism a payment p i ,
and its utility is u i ( f )= v i ( f )
p i . We now show that by using a straightforward
payment rule, we make finding a beneficial manipulation NP-hard. The payment
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