| This dissertation consists of three essays on the pricing and capacity decisions made by operators of congestible resources.; The first essay Access Charge Policy, Capacity and Delay on the Internet, analyzes Internet peering, taking into account the effects of capacity and consumer delay costs. We find the equilibrium price and capacity strategies, and compare the socially-optimal, operator-preferred, and traffic-maximizing access charges. We show these three access charges are equal with Cournot competition in both the consumer and Website markets when the operators enjoy economies of pooling. When the Website market is perfectly competitive, the access charges can differ, although they are equal in the limit with a large number of operators.; In the second essay Delay Sensitivity, Network Effects and Competition in Communication Networks, we study a communication network that serves delay-sensitive consumers in different geographical regions. We compare two alternative network operators market structures: Vertical, where each consumer segment has its own operator; and horizontal, where each operator serves a fraction of the market. We compare the operators' pricing and capacity decisions, and the resulting equilibrium welfare. We show that if consumers are not delay-sensitive, the horizontal structure increases traffic and social welfare. However, delay-sensitivity reverses the results if the capacity cost and the percentage of local traffic are large.; In the final essay Optimal Dynamic Control of a Service Facility , we study a service facility in which the system manager dynamically controls arrival and service rates to maximize long-run average value. We consider a centralized problem where both the arrival and service rates are adjustable, which we solve explicitly. Then, we solve a decentralized problem, where customers are utility maximizing, price- and delay-sensitive, and the system manager chooses state-dependent service rates and prices. We find that optimal arrival rate is decreasing and service rate is increasing in the state of the system, however, the optimal price need not be monotone. We also show that under the optimal policy the service facility operates as one with a finite buffer. We compare the social welfares achieved using dynamic and static policies, and show the dynamic policy offers significant welfare gains. |
