Implied costs in loss networks

Abstract

Implied costs in loss networks are measures of the rate of change of an objective function with respect to the parameters of the network. This paper considers these costs and the costs predicted by the Erlang fixed-point approximation. We derive exact expressions for the implied costs and consider the asymptotic accuracy of the approximation. We show that the approximation is asymptotically valid in some cases but is not valid in one important limiting regime. We also show that a linearity approximation for the implied costs is asymptotically correct when taken over suitable subsets of links.