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In this paper, we consider an orthogonal frequency division multiple access multi‐user cellular system with one full‐duplex base station communicating with multiple half‐duplex users in a bidirectional way. The uplink and downlink transmissions are coupled together because of the existence of the self‐interference at the base station and the inter‐user interference (IUI) from the uplink users to the downlink users. We aim to maximize the system sum‐rate of uplink and downlink transmissions by optimally pairing the uplink and downlink users and allocating the subcarriers and powers to these users. We formulate the problem as a mixed integer nonlinear programming problem. A two‐layer iterative solution based on the dual method and the sequential parametric convex approximation (SPCA) method is proposed. It is referred to as the dual–SPCA algorithm. The dual–SPCA algorithm requires the IUI channel state information to be available at the base station, and hence, a significant overhead is generated. To reduce the amount of overhead required, we assume that the IUI channel model is known at the base station, and we design a location‐aware resource allocation algorithm with limited channel state information that maximizes the system sum‐rate. Simulation results show that when self‐interference is low, uplink and downlink user‐pairing can provide significant improvement on the system sum‐rate compared with the conventional unidirectional half‐duplex transmission. In addition, by considering two different network deployments, such as urban macro cell scenario and small cell scenario, we show that the improvement of full‐duplex transmission over half‐duplex transmission highly depends on the channel parameters. Copyright © 2015 John Wiley & Sons, Ltd.

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