Industry
Fair Information Sharing for Treasure Hunting
Chen, Yiling (Harvard University) | Nissim, Kobbi (Ben-Gurion University and Harvard University ) | Waggoner, Bo (Harvard University)
In a search task, a group of agents compete to be the first to find the solution. Each agent has different private information to incorporate into its search. This problem is inspired by settings such as scientific research, Bitcoin hash inversion, or hunting for some buried treasure. A social planner such as a funding agency, mining pool, or pirate captain might like to convince the agents to collaborate, share their information, and greatly reduce the cost of searching. However, this cooperation is in tension with the individuals' competitive desire to each be the first to win the search. The planner's proposal should incentivize truthful information sharing, reduce the total cost of searching, and satisfy fairness properties that preserve the spirit of the competition. We design contract-based mechanisms for information sharing without money. The planner solicits the agents' information and assigns search locations to the agents, who may then search only within their assignments. Truthful reporting of information to the mechanism maximizes an agent's chance to win the search. Epsilon-voluntary participation is satisfied for large search spaces. In order to formalize the planner's goals of fairness and reduced search cost, we propose a simplified, simulated game as a benchmark and quantify fairness and search cost relative to this benchmark scenario. The game is also used to implement our mechanisms. Finally, we extend to the case where coalitions of agents may participate in the mechanism, forming larger coalitions recursively.
Price Evolution in a Continuous Double Auction Prediction Market With a Scoring-Rule Based Market Maker
Chakraborty, Mithun (Washington University in St. Louis) | Das, Sanmay (Washington University in St. Louis) | Peabody, Justin (Washington University in St. Louis)
The logarithmic market scoring rule (LMSR), the most common automated market making rule for prediction markets, is typically studied in the framework of dealer markets, where the market maker takes one side of every transaction. The continuous double auction (CDA) is a much more widely used microstructure for general financial markets in practice. In this paper, we study the properties of CDA prediction markets with zero-intelligence traders in which an LMSR-style market maker participates actively. We extend an existing idea of Robin Hanson for integrating LMSR with limit order books in order to provide a new, self-contained market making algorithm that does not need โspecialโ access to the order book and can participate as another trader. We find that, as expected, the presence of the market maker leads to generally lower bid-ask spreads and higher trader surplus (or price improvement), but, surprisingly, does not necessarily improve price discovery and market efficiency; this latter effect is more pronounced when there is higher variability in trader beliefs.
Strategic Voting and Strategic Candidacy
Brill, Markus (Duke University) | Conitzer, Vincent (Duke University)
Models of strategic candidacy analyze the incentives of candidates to run in an election. Most work on this topic assumes that strategizing only takes place among candidates, whereas voters vote truthfully. In this paper, we extend the analysis to also include strategic behavior on the part of the voters. (We also study cases where only candidates or only voters are strategic.) We consider two settings in which strategic voting is well-defined and has a natural interpretation: majority-consistent voting with single-peaked preferences and voting by successive elimination. In the former setting, we analyze the type of strategic behavior required in order to guarantee desirable voting outcomes. In the latter setting, we determine the complexity of computing the set of potential outcomes if both candidates and voters act strategically.
Combining Compact Representation and Incremental Generation in Large Games with Sequential Strategies
Bosansky, Branislav (Aarhus University) | Jiang, Albert Xin (Trinity University) | Tambe, Milind (University of Southern California) | Kiekintveld, Christopher (University of Texas at El Paso)
Many search and security games played on a graph can be modeled as normal-form zero-sum games with strategies consisting of sequences of actions. The size of the strategy space provides a computational challenge when solving these games. This complexity is tackled either by using the compact representation of sequential strategies and linear programming, or by incremental strategy generation of iterative double-oracle methods. In this paper, we present novel hybrid of these two approaches: compact-strategy double-oracle (CS-DO) algorithm that combines the advantages of the compact representation with incremental strategy generation. We experimentally compare CS-DO with the standard approaches and analyze the impact of the size of the support on the performance of the algorithms. Results show that CS-DO dramatically improves the convergence rate in games with non-trivial support
Sequence-Form Algorithm for Computing Stackelberg Equilibria in Extensive-Form Games
Bosansky, Branislav (Aarhus University) | Cermak, Jiri (Czech Technical University)
Stackelberg equilibrium is a solution concept prescribing for a player an optimal strategy to commit to, assuming the opponent knows this commitment and plays the best response. Although this solution concept is a cornerstone of many security applications, the existing works typically do not consider situations where the players can observe and react to the actions of the opponent during the course of the game. We extend the existing algorithmic work to extensive-form games and introduce novel algorithm for computing Stackelberg equilibria that exploits the compact sequence-form representation of strategies. Our algorithm reduces the size of the linear programs from exponential in the baseline approach to linear in the size of the game tree. Experimental evaluation on randomly generated games and a security-inspired search game demonstrates significant improvement in the scalability compared to the baseline approach.
Audit Games with Multiple Defender Resources
Blocki, Jeremiah (Carnegie Mellon University) | Christin, Nicolas (Carnegie Mellon University) | Datta, Anupam (Carnegie Mellon University) | Procaccia, Ariel D. (Carnegie Mellon University) | Sinha, Arunesh (University of Southern California)
Modern organizations (e.g., hospitals, social networks, government agencies) rely heavily on audit to detect and punish insiders who inappropriately access and disclose confidential information. Recent work on audit games models the strategic interaction between an auditor with a single audit resource and auditees as a Stackelberg game, augmenting associated well-studied security games with a configurable punishment parameter. We significantly generalize this audit game model to account for multiple audit resources where each resource is restricted to audit a subset of all potential violations, thus enabling application to practical auditing scenarios. We provide an FPTAS that computes an approximately optimal solution to the resulting non-convex optimization problem. The main technical novelty is in the design and correctness proof of an optimization transformation that enables the construction of this FPTAS. In addition, we experimentally demonstrate that this transformation significantly speeds up computation of solutions for a class of audit games and security games.
Justified Representation in Approval-Based Committee Voting
Aziz, Haris (NICTA and University of New South Wales) | Brill, Markus (Duke University) | Conitzer, Vincent (Duke University) | Elkind, Edith (University of Oxford) | Freeman, Rupert (Duke University) | Walsh, Toby (NICTA and UNSW)
We consider approval-based committee voting, i.e., the setting where each voter approves a subset of candidates, and these votes are then used to select a fixed-size set of winners (committee). We propose a natural axiom for this setting, which we call justified representation (JR). This axiom requires that if a large enough group of voters exhibits agree- ment by supporting the same candidate, then at least one voter in this group has an approved candidate in the winning committee. We show that for every list of ballots it is possible to select a committee that provides JR. We then check if this axiom is fulfilled by well-known approval-based voting rules. We show that the answer is negative for most of the rules we consider, with notable exceptions of PAV (Proportional Approval Voting), an extreme version of RAV (Reweighted Approval Voting), and, for a restricted preference domain, MAV (Minimax Approval Voting). We then introduce a stronger version of the JR axiom, which we call extended justified representation (EJR), and show that PAV satisfies EJR, while other rules do not. We also consider several other questions related to JR and EJR, including the relationship between JR/EJR and unanimity, and the complexity of the associated algorithmic problems.
Online Learning and Profit Maximization from Revealed Preferences
Amin, Kareem (University of Pennsylvania) | Cummings, Rachel (California Institute of Technology) | Dworkin, Lili (University of Pennsylvania) | Kearns, Michael (University of Pennsylvania) | Roth, Aaron (University of Pennsylvania)
We consider the problem of learning from revealed preferences in an online setting. In our framework, each period a consumer buys an optimal bundle of goods from a merchant according to her (linear) utility function and current prices, subject to a budget constraint. The merchant observes only the purchased goods, and seeks to adapt prices to optimize his profits. We give an efficient algorithm for the merchant's problem that consists of a learning phase in which the consumer's utility function is (perhaps partially) inferred, followed by a price optimization step. We also give an alternative online learning algorithm for the setting where prices are set exogenously, but the merchant would still like to predict the bundle that will be bought by the consumer, for purposes of inventory or supply chain management. In contrast with most prior work on the revealed preferences problem, we demonstrate that by making stronger assumptions on the form of utility functions, efficient algorithms for both learning and profit maximization are possible, even in adaptive, online settings.
Automatic Generation of Alternative Starting Positions for Simple Traditional Board Games
Ahmed, Umair Z. (Indian Institute of Technology Kanpur) | Chatterjee, Krishnendu (The Institute of Science and Technology) | Gulwani, Sumit (Microsoft Research, Redmond)
Simple board games, like Tic-Tac-Toe and CONNECT-4, play an important role not only in the development of mathematical and logical skills, but also in the emotional and social development. In this paper, we address the problem of generating targeted starting positions for such games. This can facilitate new approaches for bringing novice players to mastery, and also leads to discovery of interesting game variants. We present an approach that generates starting states of varying hardness levels for player 1 in a two-player board game, given rules of the board game, the desired number of steps required for player 1 to win, and the expertise levels of the two players. Our approach leverages symbolic methods and iterative simulation to efficiently search the extremely large state space. We present experimental results that include discovery of states of varying hardness levels for several simple grid-based board games. The presence of such states for standard game variants like 4 x 4 Tic-Tac-Toe opens up new games to be played that have never been played as the default start state is heavily biased.
Real-Time Predictive Optimization for Energy Management in a Hybrid Electric Vehicle
Styler, Alexander David (Carnegie Mellon University) | Nourbakhsh, Illah Reza (Carnegie Mellon University)
With increasing numbers of electric and hybrid vehicles on the road, transportation presents a unique opportunity to leverage data-driven intelligence to realize large scale impact in energy use and emissions. Energy management in these vehicles is highly sensitive to upcoming power load on the vehicle, which is not considered in conventional reactive policies calculated at design time. Advancements in cheap sensing and computation have enabled on-board upcoming load predictions which can be used to optimize energy management. In this work, we propose and evaluate a novel, real-time optimization strategy that leverages predictions from prior data in a simulated hybrid battery-supercapacitor energy management task. We demonstrate a complete adaptive system that improves over the lifetime of the vehicle as more data is collected and prediction accuracy improves. Using thousands of miles of real-world data collected from both petrol and electric vehicles, we evaluate the performance of our optimization strategy with respect to our cost function. The system achieves performance within 10% of the optimal upper bound calculated using a priori knowledge of the upcoming loads. This performance implies improved battery thermal stability, efficiency, and longevity. Our strategy can be applied to optimize energy use in gas-electric hybrids, battery cooling in electric vehicles, and many other load-sensitive tasks in transportation.