Due to limited buffers and highly unpredictable traffic loads, the des
ign of effective buffer management policies that minimize cell loss is
critical to ATM networks. We outline the important characteristics of
optimal buffer control policies for a single node, and using a dynami
c programming formulation for a simple two-node network, gain insights
into the much harder general multi-node problem. The key result we pr
esent is that simple non-work conserving policies which use limited fe
edback from adjacent nodes can reduce cell loss significantly. We cons
truct a feedback-based control that uses simple ''stop-and-go'' rules.
This control is then enhanced to react to rapidly changing network co
nditions. This new control is called the Adaptive HILO policy. Simulat
ion studies of complex networks with large delay-bandwidth product sho
w that the Adaptive HILO policy performs impressively under diverse co
nditions. Using intuitive arguments, we demonstrate that this policy e
ffectively utilizes unused buffer capacity in upstream buffers during
periods of heavy load in downstream buffers.