Artificial intelligence meets minority game: toward optimal resource allocation

TL;DR

This paper demonstrates that artificial intelligence, specifically reinforced learning, can effectively eliminate herding in resource allocation modeled as minority games, leading to optimal resource use without external control interventions.

Contribution

It introduces a novel AI-based approach using reinforced learning to prevent herding in minority game resource allocation systems, achieving optimal efficiency autonomously.

Findings

Herding can be eliminated using AI without external control.

The system reliably evolves toward optimal resource utilization.

Large fluctuations occur intermittently during evolution.

Abstract

Resource allocation systems provide the fundamental support for the normal functioning and well being of the modern society, and can be modeled as minority games. A ubiquitous dynamical phenomenon is the emergence of herding, where a vast majority of the users concentrate on a small number of resources, leading to a low efficiency in resource allocation. To devise strategies to prevent herding is thus of high interest. Previous works focused on control strategies that rely on external interventions, such as pinning control where a fraction of users are forced to choose a certain action. Is it possible to eliminate herding without any external control? The main point of this paper is to provide an affirmative answer through exploiting artificial intelligence (AI). In particular, we demonstrate that, when agents are empowered with reinforced learning in that they get familiar with the unknown game environment gradually and attempt to deliver the optimal actions to maximize the payoff, herding can effectively be eliminated. Computations reveal the striking phenomenon that, regardless of the initial state, the system evolves persistently and relentlessly toward the optimal state in which all resources are used efficiently. However, the evolution process is not without interruptions: there are large fluctuations that occur but only intermittently in time. The statistical distribution of the time between two successive fluctuating events is found to depend on the parity of the evolution, i.e., whether the number of time steps in between is odd or even. We develop a physical analysis and derive mean-field equations to gain an understanding of these phenomena. As minority game dynamics and the phenomenon of herding are common in social, economic, and political systems, and since AI is becoming increasingly widespread, we expect our AI empowered minority game system to have broad applications.