The curse of the first-in-first-out queue discipline

Every day people face waiting time in queues when going to the grocery store, checking in at the airport or leaving the stadium parking lot after a sports event. Often the facility where they are waiting for service will open at a specific time, and the agents will most likely be serviced in order of arrival using the first-in-first-out (FIFO) queue discipline. In this paper we consider a game in which agents choose their arrival time to a service facility where they can line up only after a given point in time. We show that in terms of equilibrium expected utility, the first-in-firstout queue discipline has inferior welfare properties in this model. In fact, in Nash equilibrium the first-in-first-out queue discipline is the worst in terms of utility and welfare among all work-conserving stochastic queue disciplines, while the last-infirst-out (LIFO) discipline comes off best. JEL codes: C72, D62, R41