Game-Theoretic Pricing and Selection with Fading Channels

TL;DR

This paper models a pricing and selection problem involving fading channels as a Stackelberg game, proving optimal policies with threshold structures and providing algorithms for solution.

Contribution

It introduces a game-theoretic framework for channel pricing and selection with fading channels, establishing the existence of optimal policies and their threshold structures.

Findings

Optimal deterministic and Markovian policies exist for the client.

Both server and client policies have threshold structures in finite horizons.

Value iteration effectively computes optimal solutions.

Abstract

We consider pricing and selection with fading channels in a Stackelberg game framework. A channel server decides the channel prices and a client chooses which channel to use based on the remote estimation quality. We prove the existence of an optimal deterministic and Markovian policy for the client, and show that the optimal policies of both the server and the client have threshold structures when the time horizon is finite. Value iteration algorithm is applied to obtain the optimal solutions for both the server and client, and numerical simulations and examples are given to demonstrate the developed result.