A strategic model of job arrivals to a single machine with earliness and tardiness penalties

Amihai Glazer, Refael Hassin and Liron Ravner

IISE Transactions, 2018, vol. 50, issue 4, 265-278

Abstract: We consider a game of decentralized timing of jobs to a single server (machine) with a penalty for deviation from a due date, and no delay costs. The jobs’ sizes are homogeneous and deterministic. Each job belongs to a single decision maker, a customer, who aims to arrive at a time that minimizes his(her) deviation penalty. If multiple customers arrive at the same time, then their order of service is determined by a uniform random draw. We show that if the cost function has a weighted absolute deviation form, then any Nash equilibrium is pure and symmetric, that is, all customers arrive together. Furthermore, we show that there exist multiple, in fact a continuum, of equilibrium arrival times, and provide necessary and sufficient conditions for the socially optimal arrival time to be an equilibrium. The base model is solved explicitly, but the prevalence of a pure symmetric equilibrium is shown to be robust to several relaxations of the assumptions: restricted server availability, inclusion of small waiting costs, stochastic job sizes, randomly sized population, heterogeneous due dates, and nonlinear deviation penalties.

Date: 2018
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Citations: View citations in EconPapers (5)

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DOI: 10.1080/24725854.2017.1395098

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