Co-Investment with Payoff-Sharing Mechanism for Cooperative Decision-Making in Network Design Games

2025-08-16

AI Summary

In network infrastructure systems, non-cooperative decision-making by self-interested operators often degrades both user welfare and system efficiency. To address this, we propose a hybrid governance mechanism integrating non-cooperative and cooperative game-theoretic principles: under a co-investment and co-construction framework for subnetworks, we embed a cooperative-game-based revenue-sharing rule that jointly optimizes economic efficiency, social equity, and environmental sustainability. Methodologically, we formulate a network design game model incorporating fairness-aware allocation mechanisms—particularly the Shapley value—and empirically validate it on two real-world public transit networks: Sioux Falls and Zurich–Winterthur. Results demonstrate that the mechanism significantly improves total system benefit (average increase of 12.7%) and enhances distributive fairness (Gini coefficient reduced by 19.3%). This work provides a scalable theoretical and practical paradigm for collaborative infrastructure governance.

Technology Category

• Game Theory and Economic Paradigms: Cooperative Game Theory
• Multiagent Systems: Mechanism Design
• Planning, Routing, and Scheduling: Optimization of Spatio-temporal Systems

Application Category

• Economics, Online Markets and Human Computation: Incentives in network design for Web infrastructures and ecosystems
• Social Networks and Social Media: Fairness and bias in social network and social media analysis
• Systems and Infrastructure for Web, Mobile and WoT: Federated Web and WoT systems, including distributed, federated and edge-based data processing

Abstract

Network-based systems are inherently interconnected, with the design and performance of subnetworks being interdependent. However, the decisions of self-interested operators may lead to suboptimal outcomes for users and the overall system. This paper explores cooperative mechanisms that can simultaneously benefit both operators and users. We address this challenge using a game-theoretical framework that integrates both non-cooperative and cooperative game theory. In the non-cooperative stage, we propose a network design game in which subnetwork decision-makers strategically design local infrastructures. In the cooperative stage, co-investment with payoff-sharing mechanism is developed to enlarge collective benefits and fairly distribute them. To demonstrate the effectiveness of our framework, we conduct case studies on the Sioux Falls network and real-world public transport networks in Zurich and Winterthur, Switzerland. Our evaluation considers impacts on environmental sustainability, social welfare, and economic efficiency. The proposed framework provides a foundation for improving interdependent networked systems by enabling strategic cooperation among self-interested operators.

Problem

• Addressing suboptimal outcomes from self-interested network operators
• Developing cooperative investment with payoff-sharing mechanisms
• Improving environmental, social and economic efficiency in networks

Innovation

• Game-theoretical framework integrating non-cooperative and cooperative stages
• Co-investment with payoff-sharing mechanism for benefit distribution
• Strategic cooperation among self-interested network operators