Keep, Customize, or Exit: Default Design and Token Pricing in LLM Reasoning Services
We study a large language model (LLM) service in which a provider chooses a per-token price and a default reasoning-token allocation, while a user may accept the default, customize the allocation, or exit. Larger allocations can improve accuracy but increase token cost and latency. We model this interaction as a Stackelberg game and derive the user's unique optimal customized allocation in closed form. For any price, the acceptable defaults form either an empty set or a compact interval. We characterize the provider's optimal default through a three-regime rule, reduce equilibrium computation to a one-dimensional price optimization, and prove the existence of the equilibrium. We further s...
| Authors | Ahmet Bugra Gundogan, Yigit Turkmen, Melih Bastopcu |
|---|---|
| Primary category | cs.GT |
| Published | 13 August 2026 |
| Last updated at source | 13 August 2026 |
Silytics shows public metadata from arXiv and links to the original. Information may be incomplete or out of date. Last refreshed 17 October 2026. Licenses and terms of the original apply to the work itself. Not financial, legal or professional advice.