Transforming Strategic Games into Biform Games: Applications in Allocation Mechanisms and Green Technology Investment

TL;DR

This paper introduces a method to convert strategic games into biform games that incorporate both cooperation and competition, analyzing their effects on outcomes like profit maximization in food pricing.

Contribution

It presents a novel transformation technique for strategic games into biform games and examines the influence of different distribution methods within this framework.

Findings

Transforming strategic games into biform games retains cooperative features.

Distribution methods significantly impact game outcomes.

Application to food producers shows practical relevance.

Abstract

As Aumann stated, cooperation and non-cooperation are different ways of viewing the same game, with the main difference being whether players can reach a binding cooperative agreement. In the real world, many games often coexist competition and cooperation. Based on the above reasons, we propose a method to transform strategic games into a biform game model, which retains the characteristics of cooperative games while considering the ultimate goal of players to maximize their own interests. Furthermore, based on this biform game model, we analyze the impact of two different distribution methods, namely marginalism and egalitarianism, on the game results. As an application, we analyze how food producers seek maximum profits through cooperative pricing.