Game theory with costly computation

Rafael Pass, Joe Halpern
2010 Proceedings of the Behavioral and Quantitative Game Theory on Conference on Future Directions - BQGT '10  
We develop a general game-theoretic framework for reasoning about strategic agents performing possibly costly computation. In this framework, many traditional game-theoretic results (such as the existence of a Nash equilibrium) no longer hold. Nevertheless, we can use the framework to provide psychologically appealing explanations to observed behavior in well-studied games (such as finitely repeated prisoner's dilemma and rock-paper-scissors). Furthermore, we provide natural conditions on games
more » ... sufficient to guarantee that equilibria exist. As an application of this framework, we develop a definition of protocol security relying on game-theoretic notions of implementation. We show that a natural special case of this this definition is equivalent to a variant of the traditional cryptographic definition of protocol security; this result shows that, when taking computation into account, the two approaches used for dealing with "deviating" players in two different communities-Nash equilibrium in game theory and zero-knowledge "simulation" in cryptography-are intimately related.
doi:10.1145/1807406.1807495 dblp:conf/bqgt/PassH10 fatcat:kyna5caupzbhjkb5dtjnwa52gq