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Strategic Network Interdiction

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  • Sunghoon Hong

    (Vanderbilt University)

Abstract

We develop a strategic model of network interdiction in a non-cooperative game of flow. An adversary, endowed with a bounded quantity of bads, chooses a flow specifying a plan for carrying bads through a network from a base to a target. Simultaneously, an agency chooses a blockage specifying a plan for blocking the transport of bads through arcs in the network. The bads carried to the target cause a target loss while the blocked arcs cause a network loss. The adversary earns and the agency loses from both target loss and network loss. The adversary incurs the expense of carrying bads. In this model we study Nash equilibria and find a power law relation between the probability and the extent of the target loss. Our model contributes to the literature of game theory by introducing non-cooperative behavior into a Kalai-Zemel (cooperative) game of flow. Our research also advances models and results on network interdiction.

Suggested Citation

  • Sunghoon Hong, 2011. "Strategic Network Interdiction," Working Papers 2011.43, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2011.43
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    Keywords

    Network Interdiction; Noncooperative Game of Flow; Nash Equilibrium; Power Law; Kalai-Zemel Game of Flow;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War

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