International Game Theory Review

Supplementing the literature on information sharing between firms, the paper seeks to understand information sharing between hackers and how firms defend against increasingly sophisticated hackers. Each hacker seeks financial gain, mutually beneficial information exchange, and reputation gain. The two hackers’ attack and the firm’s defense are inverse U shaped in each other. A hacker shifts from attack to information sharing when attack is costly or the firm’s defense is cheap. The first hacker’s information sharing increases as both hackers focus increasingly on reputation gain. The two hackers largely increase their information sharing, with two exceptions. The second hacker’s attack is deterred by the first hacker’s reputation gain. The firm’s defense against the second hacker increases in the second hacker’s unit cost, decreases in the second hacker’s information sharing effectiveness and utilization of joint sharing, and also decreases in both hackers’ reputation gain. Policy and managerial implications are provided.

I consider a two-person costly leader game — in which the follower endogenously chooses whether to buy information about the leader, and a follow-up action — with a twist. With a known probability, the leader is a nonstrategic type. A strategic type leader may choose to masquerade as a nonstrategic type, at a cost. I show that, if the follower’s cost of information is not too large, and the probability of the leader being nonstrategic is neither too large nor too small, this game has no pure strategy equilibrium. Moreover, the equilibrium of the simultaneous-move complete information game is inaccessible as follower information cost converges to zero. There is no equilibrium outcome in which leader advantage is destroyed: however, a mixed strategy equilibrium exists which does preserve leader advantage in the sense that payoffs and strategies converge to those of the sequential-move complete information equilibrium as information cost tends to zero. My results differ from some traditional results in costly leader games, and are due to the interaction of two forces, the “type uncertainty” and the “money down the drain” effects. To my knowledge this is the first paper to integrate behavioral types into costly leader games (other papers considering heterogeneity in type do not consider nonstrategic players).

The present paper discusses the comparative analysis results of resource allocation rules using experiments in the form of business games. The comparative analysis involves five rules. The resource allocation mechanism that gives the efficient solution of the problem without transferable utility, implementing it as dominant strategy equilibrium in the agents game, so called Uniform rule. The mechanism with balanced payments introduced earlier by authors using the Groves Ledyard rule that gives the efficient solution of the problem as a Nash equilibrium in the agents game, as well as its modification reducing the dimension of the action space of the agents. The mechanism from the class of proportional allocation mechanisms, where, the efficient resource allocation also represents a Nash equilibrium, but the payments are unbalanced. Last mechanism in the comparative analysis was originally developed as a distributed optimization algorithm.

A nonlinear programming method is used for finding an optimal fair division of the unit interval $[0,1)$ among $n$ players. Preferences of players are described by nonatomic probability measures ${\mu }_1,\dots ,{\mu }_n$ with piecewise linear (PWL) density functions. The presented algorithm can be applied for obtaining “almost” optimal fair divisions for measures with arbitrary density functions approximable by PWL functions. The number of cuts needed for obtaining such divisions is given.

We consider finite noncooperative $N$ person games with fixed numbers $m_i$, $i=1,\dots ,N$, of pure strategies of Player $i$. We propose the following question: is it possible to extend the vector space of finite noncooperative $(m_1\times m_2\times \cdots \times m_N)$-games in mixed strategies such that all games of a broader vector space of noncooperative $N$ person games on the product of unit $(m_i-1)$-dimensional simplices have Nash equilibrium points? We get a necessary and sufficient condition for the negative answer. This condition consists of a relation between the numbers of pure strategies of the players. For two-person games the condition is that the numbers of pure strategies of the both players are equal.

In this paper, we propose an axiomatic extension for the Solidarity value of Nowak and Radzik [1994] A solidarity value for $n$-person transferable utility games, Int. J. Game Theor. 23, 43–48] to the class of games with externalities. This value is characterized as the unique function that satisfies linearity, symmetry, efficiency and average nullity. In this context, we discuss a key subject of how to extend the concept of average marginal contribution to settings where externalities are present.