Distributed Algorithmic Mechanism Design (DAMD) combines theoretical computer science's traditional focus on computational tractability with its more recent interest in incentive compatibility and distributed computing. The Internet's decentralized nature, in which distributed computation and autonomous agents prevail, makes DAMD a very natural approach for many Internet problems. This paper first outlines the basics of DAMD and then reviews previous DAMD results on multicast cost sharing and interdomain routing. The remainder of the paper describes several promising research directions and poses some specific open problems.

The routing of traffic between... this paper, we address the problem of interdomain routing from a mechanism-design point of view. The application of mechanism-design principles to the study of routing is the subject of earlier work by Nisan and Ronen [15] and Hershberger and Suri [11]. In this paper, we formulate and solve a version of the routing-mechanism design problem that is different from the previously studied version in three ways that make it more accurately reflective of real-world interdomain routing: (1) we treat the nodes as strategic agents, rather than the links; (2) our mechanism computes lowest-cost routes for all source-destination pairs and payments for transit nodes on all of the routes (rather than computing routes and payments for only one source-destination pair at a time, as is done in [15,11]); (3) we show how to compute our mechanism with a distributed algorithm that is a straightforward extension to BGP and causes only modest increases in routingtable size and convergence time (in contrast with the centralized algorithms used in [15,11]). This approach of using an existing protocol as a substrate for distributed computation may prove useful in future development of Internet algorithms generally, not only for routing or pricing problems. Our design and analysis of a strategyproof, BGP-based routing mechanism provides a new, promising direction in distributed algorithmic mechanism design, which has heretofore been focused mainly on multicast cost sharing.

Noncooperative game theory provides a normative framework for analyzing strategic interactions.

We consider the problem of selecting a low cost s − t path in a graph, where the edge costs are a secret known only to the various economic agents who own them. To solve this problem, Nisan and Ronen applied the celebrated Vickrey-Clarke-Groves (VCG) mechanism, which pays a premium to induce the edges to reveal their costs truthfully. We observe that this premium can be unacceptably high. There are simple instances where the mechanism pays Θ(k) times the actual cost of the path, even if there is an alternate path available that costs only (1 + ɛ) times as much. This inspires the frugal path problem, which is to design a mechanism that selects a path and induces truthful cost revelation without paying such a high premium. This paper contributes negative results on the frugal path problem. On two large classes of graphs, including ones having three node-disjoint s − t paths, we prove that no reasonable mechanism can always avoid paying a high premium to induce truthtelling. In particular, we introduce a general class of min function mechanisms, and show that all min function mechanisms can be forced to overpay just as badly as VCG. On the other hand, we prove that (on two large classes of graphs) every truthful mechanism satisfying some reasonable properties is a min function mechanism. 1

In many applications, wireless ad-hoc networks are formed by devices belonging to independent users. Therefore, a challenging problem is how to provide incentives to stimulate cooperation. In this paper, we study ad-hoc games—the routing and packet forwarding games in wireless ad-hoc networks. Unlike previous work which focuses either on routing or on forwarding, this paper investigates both routing and forwarding. We first uncover an impossibility result—there does not exist a protocol such that following the protocol to always forward others’ traffic is a dominant action. Then we define a novel solution concept called cooperation-optimal protocols. We present Corsac, a cooperation-optimal protocol consisting of a routing protocol and a forwarding protocol. The routing protocol of Corsac integrates VCG with a novel cryptographic technique to address the challenge in wireless ad-hoc networks

We consider the problem of picking (buying) an inexpensive s t path in a graph where edges are owned by independent (selfish) agents, and the cost of an edge is known to its owner only. We study the problem of finding frugal mechanisms for this task, i.e. we investigate the payments the buyer must make in order to buy a path.

The Border Gateway Protocol (BGP) for interdomain routing is designed to allow autonomous systems (ASes) to express policy preferences over alternative routes. We model these preferences as arising from an AS's underlying utility for each route and study the problem of finding a set of routes that maximizes the overall welfare (i.e., the sum of all ASes' utilities for their selected routes).

in Proceedings of the 3rd ACM Conference on Electronic Commerce, Tampa FL, October 2001. This work was supported by the DoD University Research Initiative (URI) program administered by the Oce of Naval Research under Grant N00014-01-1-0795.

The routing of traffic between Internet domains, or Autonomous Systems (ASes), a task known as interdomain routing, is currently handled by the Border Gateway Protocol (BGP) [17]. Using BGP, autonomous systems can apply semantically rich routing policies to choose interdomain routes in a distributed fashion. This expressiveness in routing-policy choice supports domains ’ autonomy in network operations and in business decisions, but it comes at a price: The interaction of locally defined routing policies can lead to unexpected global anomalies, including route oscillations or overall protocol divergence (see, e.g., [20]). Networking researchers have addressed this problem by devising constraints on policies that guarantee BGP convergence without unduly limiting expressiveness and autonomy (see, e.g., [7, 8]). In addition to taking this engineering or “protocol-design ” approach, researchers have approached interdomain routing from an economic or “mechanism-design ” point of view. It is known that lowest-cost-path (LCP) routing can be implemented in a truthful, BGP-compatible manner [3] but that several other natural classes of routing policies cannot [2, 5]. In this paper, we present a natural class of interdomain-routing policies that is more realistic than LCP routing and admits incentive-compatible, BGP-compatible implementation. We also present several positive steps toward a general theory of incentive-compatible interdomain routing.

We prove super-linear lower bounds for some shortest path problems in directed graphs, where no such bounds were previously known. The central problem in our study is the replacement paths problem: Given a directed graph G with non-negative edge weights, and a shortest path P = {e_1, e_2, ..., e_p} between two nodes s and t, compute the shortest path distances from s to t in each of the p graphs obtained from G by deleting one of the edges e_i. We show that the replacement paths problem requires Ω(m√n) time in the worst case whenever m = O(n√n). This also establishes a similar...