Distributed consensus in noncooperative inventory games

Dario Bauso, Laura Giarre, Raffaele Pesenti*

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

11 Citations (Scopus)
17 Downloads (Pure)

Abstract

This paper deals with repeated nonsymmetric congestion games in which the players cannot observe their payoffs at each stage. Examples of applications come from sharing facilities by multiple users. We show that these games present a unique Pareto optimal Nash equilibrium that dominates all other Nash equilibria and consequently it is also the social optimum among all equilibria, as it minimizes the sum of all the players' costs. We assume that the players adopt a best response strategy. At each stage, they construct their belief concerning others probable behavior, and then, simultaneously make a decision by optimizing their payoff based on their beliefs. Within this context, we provide a consensus protocol that allows the convergence of the players' strategies to the Pareto optimal Nash equilibrium. The protocol allows each player to construct its belief by exchanging only some aggregate but sufficient information with a restricted number of neighbor players. Such a networked information structure has the advantages of being scalable to systems with a large number of players and of reducing each player's data exposure to the competitors. (c) 2007 Elsevier B.V. All rights reserved.

Original languageEnglish
Pages (from-to)866-878
Number of pages13
JournalEuropean Journal of Operational Research
Volume192
Issue number3
DOIs
Publication statusPublished - 1-Feb-2009
Externally publishedYes

Keywords

  • Game theory
  • Multi-agent systems
  • Inventory
  • Consensus protocols
  • SUPPLY CHAIN
  • INFORMATION
  • SYSTEMS
  • NETWORKS
  • AGENTS

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