Citation
Yi Ouyang, Hamidreza Tavafoghi, Demos Teneketzis. "Dynamic Games with Asymmetric Information: Common Information Based Perfect Bayesian Equilibria and Sequential Decomposition". IEEE Transactions on Automatic Control, 2016.

Abstract
We formulate and analyze a general class of stochastic dynamic games with asymmetric information arising in dynamic systems. In such games, multiple strategic agents control the system dynamics and have different information about the system over time. Because of the presence of asymmetric information, each agent needs to form beliefs about other agents’ private information. Therefore, the specification of the agents’ beliefs along with their strategies is necessary to study the dynamic game. We use Perfect Bayesian equilibrium (PBE) as our solution concept. A PBE consists of a pair of strategy profile and belief system. In a PBE, every agent’s strategy should be a best response under the belief system, and the belief system depends on agents’ strategy profile when there is signaling among agents. Therefore, the circular dependence between strategy profile and belief system makes it difficult to compute PBE. Using the common information among agents, we introduce a subclass of PBE called common information based perfect Bayesian equilibria (CIB-PBE), and provide a sequential decomposition of the dynamic game. Such decomposition leads to a backward induction algorithm to compute CIB-PBE. We illustrate the sequential decomposition with an example of a multiple access broadcast game. We prove the existence of CIBPBE for a subclass of dynamic games.

Electronic downloads

• http://ieeexplore.ieee.org/stamp/stamp.jsp?tp=&arnumber=7438815

• HTML

  Yi Ouyang, Hamidreza Tavafoghi, Demos Teneketzis. <a
  href="http://www.cps-forces.org/pubs/155.html"
  >Dynamic Games with Asymmetric Information: Common
  Information Based Perfect Bayesian Equilibria and Sequential
  Decomposition</a>, <i>IEEE Transactions on
  Automatic Control</i>,  2016.

• Plain text

  Yi Ouyang, Hamidreza Tavafoghi, Demos Teneketzis.
  "Dynamic Games with Asymmetric Information: Common
  Information Based Perfect Bayesian Equilibria and Sequential
  Decomposition". <i>IEEE Transactions on Automatic
  Control</i>,  2016.

• BibTeX

  @article{OuyangTavafoghiTeneketzis16_DynamicGamesWithAsymmetricInformationCommonInformation,
      author = {Yi Ouyang and Hamidreza Tavafoghi and Demos
                Teneketzis},
      title = {Dynamic Games with Asymmetric Information: Common
                Information Based Perfect Bayesian Equilibria and
                Sequential Decomposition},
      journal = {IEEE Transactions on Automatic Control},
      year = {2016},
      abstract = {We formulate and analyze a general class of
                stochastic dynamic games with asymmetric
                information arising in dynamic systems. In such
                games, multiple strategic agents control the
                system dynamics and have different information
                about the system over time. Because of the
                presence of asymmetric information, each agent
                needs to form beliefs about other agents’
                private information. Therefore, the specification
                of the agents’ beliefs along with their
                strategies is necessary to study the dynamic game.
                We use Perfect Bayesian equilibrium (PBE) as our
                solution concept. A PBE consists of a pair of
                strategy profile and belief system. In a PBE,
                every agent’s strategy should be a best response
                under the belief system, and the belief system
                depends on agents’ strategy profile when there
                is signaling among agents. Therefore, the circular
                dependence between strategy profile and belief
                system makes it difficult to compute PBE. Using
                the common information among agents, we introduce
                a subclass of PBE called common information based
                perfect Bayesian equilibria (CIB-PBE), and provide
                a sequential decomposition of the dynamic game.
                Such decomposition leads to a backward induction
                algorithm to compute CIB-PBE. We illustrate the
                sequential decomposition with an example of a
                multiple access broadcast game. We prove the
                existence of CIBPBE for a subclass of dynamic
                games.},
      URL = {http://cps-forces.org/pubs/155.html}
  }
  

Posted by Hamidreza Tavafoghi on 23 May 2016.
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