IDENTIFICATION OF TWO-PLAYER SITUATIONS WHERE COOPERATION IS PREFERABLE TO USE OF PERCENTILE GAME THEORY.
SOUTHERN METHODIST UNIV DALLAS TEX DEPT OF STATISTICS
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Considered is descrete two-person game theory where the players choose their strategies and separately and independently. A generally applicable form of percentile game theory, using mixed strategies, has been developed where player i can select a 100 alpha subi percentile criterion and determine a solution that is optimum to him for this criterion ii,2. The only requirement for usability is that, separately, each player can rank the outcomes for the game pairs of payoffs, one to each player according to their desirability to him. When cooperation can occur, however, cooperative choice of strategies can have advantages compared to a specified use, or class of uses, of percentile game theory a use is defined by the values of the two percentiles. The paper identifies situations where cooperation is definitely preferable, for two types of cooperation. No side payments are made for one type of cooperation. This type can occur for any situation where percentile game theory is applicable. Side payments can be made for the other type of cooperation. This type occurs for situations where all payoffs can be expressed in a common unit and satisfy arithmetical operations. Rules are given for deciding when cooperation is definitely advantageous. Author
- Operations Research