Year: 2023
Type: preprint
Abstract: We study the optimal method for rationing scarce resources through a queue system. The designer controls agents' entry into a queue and their exit, their service priority -- or queueing discipline -- as well as their information about queue priorities, while providing them with the incentive to join the queue and, importantly, to stay in the queue, when recommended by the designer. Under a mild condition, the optimal mechanism induces agents to enter up to a certain queue length and never removes any agents from the queue; serves them according to a first-come-first-served (FCFS) rule; and provides them with no information throughout the process beyond the recommendations they receive. FCFS is also necessary for optimality in a rich domain. We identify a novel role for queueing disciplines in regulating agents' beliefs and their dynamic incentives and uncover a hitherto unrecognized virtue of FCFS in this regard.
Source: arXiv (Cornell University)
Authors: Che, Yeon-Koo, Tercieux, Olivier
Institution: Paris School of Economics
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W4384643834