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Cognitive radios (CRs) have a great potential to improve spectrum utilization by enabling users to access the spectrum dynamically without disturbing licensed primary radios (PRs). A key challenge in operating these radios as a network is how to implement an efficient medium access control (MAC) mechanism that can adaptively and efficiently allocate transmission powers and spectrum among CRs according to the surrounding environment. Most existing works address this issue via sub-optimal heuristic approaches or centralized solutions. In this paper, we propose a novel joint power/channel allocation scheme that improves the performance through a distributed pricing approach. In this scheme, the spectrum allocation problem is modeled as a non-cooperative game, with each CR pair acting as a player. A price-based iterative water-filling (PIWF) algorithm is proposed, which enables CR users to reach a good Nash equilibrium (NE). This PIWF algorithm can be implemented distributively with CRs repeatedly negotiating their best transmission powers and spectrum. Simulation results show that the social optimality of the NE solution is dramatically improved through pricing. Depending on the different orders according to which CRs take actions, we study sequential and parallel versions of the PIWF algorithm. We show that the parallel version converges faster than the sequential version. We then propose a corresponding MAC protocol to implement our resource management schemes. The proposed MAC allows multiple CR pairs to be first involved in an admission phase, then iteratively negotiate their transmission powers and spectrum via control-packet exchanges. Following the negotiation phase, CRs proceed concurrently with their data transmissions. Simulations are used to study the performance of our protocol and demonstrate its effectiveness in terms of improving the overall network throughput and reducing the average power consumption.

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