Efficiency and Cost Alignment in Batched LLM Serving via Resource-Fair Scheduling

This paper studies a resource-allocation inefficiency in batched large language model (LLM) serving: heterogeneous requests that share a decode batch impose max-driven computational costs on one another. Because the wall-clock cost of a batch step is largely governed by the largest active KV-cache footprint, a short request co-batched with a long request can experience latency and GPU-resource consumption disproportionate to its own token workload. We formalize this phenomenon as a resource-fair scheduling problem. We develop a mathematical scheduling model that connects within-batch resource fairness to system throughput. The proposed fairness constraint bounds the disparity in decode progress, equivalently KV-cache footprint, among co-batched requests. Based on this model, we design the Insert-Short-Jobs-with-Limit (ISJL) algorithm, a parameterized hybrid batching policy. We prove that ISJL achieves a global competitive-ratio lower bound of 3/4. We further examine the profit implications of resource-fair scheduling under the token-metered pricing convention used by commercial LLM APIs. Numerical experiments show that ISJL occupies a favorable middle ground between FCFS, which has large batching externalities, and LJF, which is cost-aligned but sacrifices batching flexibility. Thus, ISJL provides a bi-criterion scheduling policy: it maintains high throughput while aligning max-driven batch cost with token-metered revenue.