Arrangement Increasing Resource Allocation

Methodology and Computing in Applied Probability, Forthcoming

24 Pages Posted: 22 May 2017 Last revised: 27 Jul 2017

See all articles by Qi Feng

Qi Feng

Purdue University - Krannert School of Management

J. George Shanthikumar

Purdue University - Krannert School of Management

Date Written: May 22, 2017

Abstract

Consider a system composed of several units. The performance of each unit can be affected by providing a portion of a limited amount of costly resources available. An allocation of resources to a unit results in a unit's response that depends on the level of resources allocated to it and some of its random parameters. In this paper we consider cases where each unit has one or two random parameters. The overall performance of the system is mapped by a function on the vector of responses generated by all the units in the system. Our interest is in identifying the conditions on the response function of the units, the system performance function and the random parameters under which the random system performance as a function of the resource allocation has stochastic arrangement increasing property. This allows one to substantially reduce the number of allocation that needs to be searched to identify an optimal allocation that maximizes the expected utility derived from the system response as a result of the resource allocation.

Keywords: Allocation, arrangement increasing, joint stochastic orders, joint stochastic increasing vector, stochastic functions

Suggested Citation

Feng, Qi and Shanthikumar, J. George, Arrangement Increasing Resource Allocation (May 22, 2017). Methodology and Computing in Applied Probability, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2971945 or http://dx.doi.org/10.2139/ssrn.2971945

Qi Feng (Contact Author)

Purdue University - Krannert School of Management ( email )

1310 Krannert Building
West Lafayette, IN 47907-1310
United States

J. George Shanthikumar

Purdue University - Krannert School of Management ( email )

1310 Krannert Building
West Lafayette, IN 47907-1310
United States

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