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Market Oriented Programming
Sai Rahul Reddy P
5/23/2017
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What is Market Oriented Programming ?
 Market-oriented programming (MOP) is a mathematical programming
approach to distributed computation using selfish agents, based on
market price mechanisms
 MOP exploits the institution of markets to solve particular problems of
distributed resource allocation
 Comprises of two problems: Allocation and Pricing
 Inspired in part by economists (market mechanisms) and also by AI
(heterogeneous, self interested agents)
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Basics of Micro Economics …
Price
Simple Supply and Demand curve
Quantity
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Basics of Micro Economics …
Price
p1
Simple Demand curve
p2
q1
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Quantity
q2
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Basics of Micro Economics …
Supply Curve
Price
p2
p1
Quantity
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q1
Market Oriented Programming
q2
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Basics of Micro Economics …
Equilibrium
Price
p1
pe
q1
qe
q2
Quantity
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Example: Mungi
• Price per unit of storage is price(€) = 1 + 4p€2exp(€/(1- €) -1), € (0< €<1) is
the storage utilization of the system
• Taxation function is t(β) = b[1-exp(-β/b)],
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Example: Load Balancing Problem
Cost of the job
• The cost of buying μJ/rk CPU seconds at Pk.
• The cost to cross the link to get to Pk.
• The cost to get from the Pk to the processor at which J entered the system.
Job Preferences
• Price Preference
• Service time preference
• Service and price preference
Economic Model
Auctions
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Other Examples
• Spawn
Uses the monetary funding units as an abstract form of priority in
distributed and heterogeneous systems.
The use of price information to control adaptive expansion and
contraction of process trees in concurrent applications.
• Data Management Economy
• Flow Control Economy
• Quality of service in computer networks
• Multiple Access Protocols
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Mechanism Design 6
 Given:
 System comprising of self-interested, rational agents
 Set of system wide goals
 Mechanism Design
 Does there exist a mechanism that can implement the goals ?
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Example: System “ABC”



ABC: A new breed of software agents??
System:
 One Seller with a single indivisible good
 N buyers (agents) each with value vi for the good (money
value)
 vi is known only to agent i
 Value vi: Maximum value agent i is willing to pay for the good
(Agent is indifferent between the good and the money value
vi)
Goals:
 G1: Sell the good to agent (buyer) with highest vi
 G2: The buying agent pays vi to the seller for the good
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First Price Sealed Bid Auction

Mechanism
 Each agent submits a sealed bid to the seller
 Good is sold to the agent with the highest bid
 The winning agent pays the quoted bid value to the seller

Does this mechanism implements G1 and G2?
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First Price Sealed Bid Auction: Agent Strategy

Overbid
 If the agent wins, it has to pay more than it is worth

Bid True Value vi
 If the agent wins, it has to pay its original value and the agent
gains nothing

Underbid
 Reduces the chance of winning
 Less the agent pays than vi more it gains
 Strategy: Bid slightly more than the expected second highest
price
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Vickrey Auction

Mechanism
 Each agent submits a sealed bid to the seller
 Good is sold to the agent with the highest bid
 The winning agent pays the second highest bid value to the
seller

Does this mechanism implements G1 and G2?
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Vickrey Auction : Agent Strategy



Overbid X
 If the agent is the real winner and wins, it gains nothing
 If the agent is not the real winner and wins by overbidding, it
may pay more than its value
Underbid X
 If the agent is the real winner and wins, it gains nothing
 The agent may lose by underbidding
Bid True Value vi 
 Best Strategy
 Tell the truth independent of what agents do (Dominant
Strategy)
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English Auction

Mechanism
 Open out-cry ascending price auction
 Starts with a minimum bid value quoted by the seller
 Agent can revise the bid amount upward by a minimum
increment 
 Auction ends when bidding stops
 Highest bidder gets the object and pays the amount quoted

Does this mechanism implements G1 and G2?
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Evaluation of Auctions ?
• Allocation Efficiency
• Revenues
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References
1. Ferguson, D., et al, Microeconomic algorithms for load balancing in distriuted
computer systems, Proc. 8th Int'l Conf. Distributed Computing Systems.
2. Ferguson, D et al, Economic models for allocating resources in computer
systems,Book: Market-based control: a paradigm for distributed resource
allocation.
3. G. Heiser, F. Lam, and S. Russell, Resource Management in the Mungi SingleAddress-Space Operating System, Proceedings of Australasian Computer
Science Conference.
4. http://en.wikipedia.org/en/Supply
5. Wellman, MP, Market-Oriented Programming: Some Early lessons, Book:
Market-based control: a paradigm for distributed resource allocation
6. http://purana.csa.iisc.ernet.in/~mbk/jammin/kamesh.html (Slides Taken)
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Load Balancing In Clusters
Jobs Assignment
For each machine in a cluster of n machines, with resources r1, r2, . . . rk. The
machine’s cost is defined as
k
∑f( n, utilization of ri ).
i=1
Where f is some function. Jobs are assigned to resources in such a way to
minimizes this marginal cost.
Jobs Re-assignment
When a job terminates we will check the stability condition for each job j and
each machine M. If stability condition fails the job is reassigned in such a way
that minimizes the marginal cost.
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