2012 | OriginalPaper | Chapter
Selfishness Level of Strategic Games
Authors : Krzysztof R. Apt, Guido Schäfer
Published in: Algorithmic Game Theory
Publisher: Springer Berlin Heidelberg
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We introduce a new measure of the discrepancy in strategic games between the social welfare in a Nash equilibrium and in a social optimum, that we call
selfishness level
. It is the smallest fraction of the social welfare that needs to be offered to each player to achieve that a social optimum is realized in a pure Nash equilibrium. The selfishness level is unrelated to the price of stability and the price of anarchy and in contrast to these notions is invariant under positive linear transformations of the payoff functions. Also, it naturally applies to other solution concepts and other forms of games.
We study the selfishness level of several well-known strategic games. This allows us to quantify the implicit tension within a game between players’ individual interests and the impact of their decisions on the society as a whole. Our analysis reveals that the selfishness level often provides more refined insights into the game than other measures of inefficiency, such as the price of stability or the price of anarchy.