Group for Research in Decision Analysis

Hierarchical Models for Aggregative Games with Supermodularity

Lina Mallozzi – Università Degli Studi Di Napoli Federico II, Italy

We deal with $$n$$-person normal form games where the players of a subset decide to cooperate (signatories) and choose strategies by maximizing the aggregate welfare of the coalition members. The non-cooperating (non-signatories) players choose their strategies as a Nash equilibrium. A hierarchical model with one leader (the signatory coalition) and $$k$$ followers is defined, also in the case of non-signatories multiple decision. For this model we consider aggregative games, i.e. games having the payoffs depending only on individual strategy and an aggregate of all strategies. By using supermodularity tools, we describe some properties of the game. Then, applications to public goods games and global emission games via supermodularity are illustrated.