Technische Universitt Mnchen Institut fr Informatik (I18) Prof. Dr. F. Brandt / Dr. P. Harrenstein, H. G.

Seedig

SS 2012 Exercise sheet 6 June 5, 2012

Algorithmic Game Theory (IN2239)

G-exercise due: June 8, 2012, 23:59 (Moodle, https://www.moodle.tum.de) H-exercises due: June 11, 2012, 16:00 (post box in FMI basement marked Prof. Brandt) Please mention the number of your tutor group on your assignment sheet.

Exercise 21

Tragedy of the Commons (G)

You possess 10 cows, any number of which you can let graze on the commons. The yield of each cow on the commons (in hectoliters) is inversely proportional to the total number of cows grazing there and is captured by the following function f, where x is the total number of cows grazing on the commons and n the number of students participating in the game, f(x) = x 2 . 5 25n

yield per cow

2 5

f(x)
1 5

total number of cows x

10n

You will be awarded as many points as hectoliters your cows produce on the commons (cows not grazing on the commons have no yield.). Example: Your answer is 3 (cows), you are one of 10 players participating, and the total number of cows on the commons (including the ones you let graze) is 65. Then your payo is 3 (2/5 65/2510) = 3 0.14 = 0.42 points. Choose an integer between 0 and 10 representing the number of cows you want to let graze on the commons and submit it to Moodle. As before, you are encouraged to coordinate with your fellow students through the courses discussion board in Moodle.

Exercise 22

Alice, Bob, and Charlie (H)

Recall that a quasi-strict equilibrium is a Nash equilibrium s such that ui (ai , si ) > ui (bi , si ) for all players i, all ai supp(si ), and bi supp(si ). / (a) Alice, Bob, and Charlie use the following procedure to decide who of them has to take out the garbage. Each of them independently and simultaneously are to raise their hand or not. Alice loses if exactly one player raises his hand, whereas Bob loses if exactly two players raise their hands, and Charlie loses if either all or no players raise their hand. 1, 1, 0 0, 1, 1 0, 1, 1 1, 0, 1 0, 1, 1 1, 0, 1 1, 0, 1 1, 1, 0

Determine the unique Nash equilibrium of this game and check whether it is quasistrict. Also determine the maximin strategies. Which strategy would you recommend to each of the players? (b) Now Alice, Bob, and Charlie play the following game, in which Alice chooses rows, Bob chooses columns, and Charlie chooses matrices. 1, 0, 0 0, 0, 1 0, 1, 0 1, 0, 0 1, 0, 0 0, 1, 0 0, 0, 1 0, 0, 1

Determine a quasi-strict equilibrium in which Alice has no chance of winning, one in which Bob has no chance of winning, and one in which all players have a positive chance of winning. Exercise 23 Trembling-hand perfect equilibrium (H)

Recall that a trembling-hand perfect equilibrium is a strategy prole s such that there exists a sequence (sk ) of strategy proles with full support that converges to s and for k=1 each player i and all k 1, si is a best-response to sk . i (a) Consider the following game. 0, 0 0, 0 0, 0 0, 0 1, 1 2, 0 0, 0 0, 2 2, 2 Determine the trembling-hand perfect equilibria of this game. (b) Prove that for two-player games, a strategy prole is a trembling-hand perfect equilibrium if and only if it is a Nash equilibrium and neither players strategy is weakly dominated. (Hint: you may assume that if a strategy is not weakly dominated, it is a best-response to some strategy of the opponent with full support.) 2

(c) Construct a binary three-player game in which each player has two actions that shows that the characterization in (b) does not hold in general. Exercise 24 Correlated equilibrium (T)

A correlated strategy prole in a normal-form game is a probability distribution p : A [0, 1] over the action proles. p is a correlated equilibrium, if for each player i and all actions ai , b i A i , p(ai , ai )ui (ai , ai )
ai Ai ai Ai

p(ai , ai )ui (ai , bi )

(a) Consider the following game: 6, 6 2, 7 7, 2 0, 0 This game has exactly two pure Nash equilibria with outcomes (2, 7) and (7, 2) along with an additional mixed equilibrium yielding (4 2 , 4 2 ). Show that the game has a 3 3 correlated equilibrium with outcome (5, 5). (b) Give a linear program for computing a correlated equilibrium that minimizes the dierence in payo to the rst two players.