Nash equilibrium seeking for a class of quadratic-bilinear Wasserstein distributionally robust games

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Main Authors: Pantazis, Georgios, Baghbadorani, Reza Rahimi, Grammatico, Sergio
Format: Preprint
Published: 2024
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author Pantazis, Georgios
Baghbadorani, Reza Rahimi
Grammatico, Sergio
author_facet Pantazis, Georgios
Baghbadorani, Reza Rahimi
Grammatico, Sergio
contents We consider a class of Wasserstein distributionally robust Nash equilibrium problems, where agents construct heterogeneous data-driven Wasserstein ambiguity sets using private samples and radii, in line with their individual risk-averse behaviour. By leveraging relevant properties of this class of games, we show that equilibria of the original seemingly infinite-dimensional problem can be obtained as a solution to a finite-dimensional Nash equilibrium problem. We then reformulate the problem as a finite-dimensional variational inequality and establish the connection between the corresponding solution sets. Our reformulation has scalable behaviour with respect to the data size and maintains a fixed number of constraints, independently of the number of samples. To compute a solution, we leverage two algorithms, based on the golden ratio algorithm. The efficiency of both algorithmic schemes is corroborated through extensive simulation studies on an illustrative example and a stochastic portfolio allocation game, where behavioural coupling among investors is modeled.
format Preprint
id arxiv_https___arxiv_org_abs_2411_09636
institution arXiv
publishDate 2024
record_format arxiv
spellingShingle Nash equilibrium seeking for a class of quadratic-bilinear Wasserstein distributionally robust games
Pantazis, Georgios
Baghbadorani, Reza Rahimi
Grammatico, Sergio
Optimization and Control
Multiagent Systems
Systems and Control
We consider a class of Wasserstein distributionally robust Nash equilibrium problems, where agents construct heterogeneous data-driven Wasserstein ambiguity sets using private samples and radii, in line with their individual risk-averse behaviour. By leveraging relevant properties of this class of games, we show that equilibria of the original seemingly infinite-dimensional problem can be obtained as a solution to a finite-dimensional Nash equilibrium problem. We then reformulate the problem as a finite-dimensional variational inequality and establish the connection between the corresponding solution sets. Our reformulation has scalable behaviour with respect to the data size and maintains a fixed number of constraints, independently of the number of samples. To compute a solution, we leverage two algorithms, based on the golden ratio algorithm. The efficiency of both algorithmic schemes is corroborated through extensive simulation studies on an illustrative example and a stochastic portfolio allocation game, where behavioural coupling among investors is modeled.
title Nash equilibrium seeking for a class of quadratic-bilinear Wasserstein distributionally robust games
topic Optimization and Control
Multiagent Systems
Systems and Control
url https://arxiv.org/abs/2411.09636