The Impact of Social Value Orientation on Nash Equilibria of Two Player Quadratic Games

TL;DR

This paper analyzes how social value orientation influences Nash equilibria in two-player quadratic games, providing a detailed mathematical characterization and exploring bounded and unbounded solutions in dynamic scenarios.

Contribution

It introduces a framework for characterizing social value orientation-based Nash equilibria in quadratic games, including new analytical tools and solution bounds.

Findings

Bounded and unbounded equilibria can exist in social value orientation quadratic games.

Equilibria are characterized by eigenvalue problems and geometric intersections of ellipses.

Application demonstrated in a trajectory coordination scenario with linear time-varying dynamics.

Abstract

We consider two player quadratic games in a cooperative framework known as social value orientation, motivated by the need to account for complex interactions between humans and autonomous agents in dynamical systems. Social value orientation is a framework from psychology, that posits that each player incorporates the other player's cost into their own objective function, based on an individually pre-determined degree of cooperation. The degree of cooperation determines the weighting that a player puts on their own cost relative to the other player's cost. We characterize the Nash equilibria of two player quadratic games under social value orientation by creating expansions that elucidate the relative difference between this new equilibria (which we term the SVO-Nash equilibria) and more typical equilibria, such as the competitive Nash equilibria, individually optimal solutions, and the fully cooperative solution. Specifically, each expansion parametrizes the space of cooperative Nash equilibria as a family of one-dimensional curves where each curve is computed by solving an eigenvalue problem. We show that both bounded and unbounded equilibria may exist. For equilibria that are bounded, we can identify bounds as the intersection of various ellipses; for equilibria that are unbounded, we characterize conditions under which unboundedness will occur, and also compute the asymptotes that the unbounded solutions follow. We demonstrate these results in trajectory coordination scenario modeled as a linear time varying quadratic game.