A Stackelberg game approach to distributed spectrum management

In this paper, we consider a cognitive radio system with one primary (licensed) user and multiple secondary (unlicensed) users. Considering the interference temperature constraints, the secondary users compete for the available spectrum so as to satisfy their need for communication. Borrowing the concept of price from market theory, we develop a decentralized Stackelberg game formulation for power allocation. In this scheme, primary user (leader) announces prices for the available tones such that a system utility is maximized. Using the announced prices, secondary users (followers) compete for the available bandwidth to maximize their own utilities. We show that this Stackelberg game is polynomial time solvable under certain channel conditions. The proposed method is decomposable across the tones and is more power efficient than the Iterative Water-Filling Algorithm.