Contract‐auction based distributed resource allocation for cooperative communications

Cooperative communication significantly improves the performance of wireless systems. Transmission of signal in such a system can be accomplished by the help of intermediate relay nodes. However, due to the selfish nature of network nodes, an incentive mechanism is required to stimulate relay nodes to cooperate. On the other hand, the authors assume that the source nodes are ill‐informed about channel conditions of the relay nodes, which may result in asymmetry of information. In this study, the authors propose a distributed power allocation and price assignment algorithm over cooperative wireless networks. The proposed solution aims to achieve optimum power allocation to the source nodes and best price of power at the relay nodes, in the presence of asymmetric channel state information. To this end, the authors combine contract theory and auction mechanism in order to provide the highest possible utility for both the source and the relay nodes. The proposed distributed approach benefits the source nodes by preventing the relay nodes from cheating behaviour. Additionally, it favours the relay nodes by letting them assign the final price of power. Finally, the authors present simulation results in order to demonstrate efficiency of the proposed distributed multi‐user algorithm.