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Abstract Collaboration enables multiple actors with different objectives to work together and achieve a goal beyond individual capabilities. However, strategic uncertainty from partners' actions introduces a potential for losses under failed collaboration relative to pursuing an independent system. The fundamental tradeoff between high‐value but uncertain outcomes from collaborative systems and lower‐value but more certain outcomes for independent systems induces a bistability strategic dynamic. Actors exhibit different risk attitudes that impact decisions under uncertainty which complicate shared understanding of collaborative dynamics. This paper investigates how risk attitudes affect design and strategy decisions in collaborative systems through the lens of game theory. First, an analytical model studies the effect of differential risk attitudes in a two‐actor problem with stag‐hunting strategic dynamics formulated as single‐ and bi‐level games. Next, a simulation model pairs actors with different risk attitudes in a 29‐game tournament based on a prior behavioral experiment. Results show that outcomes collaborative design problems change based on the risk attitudes of both actors. Results also emphasize that considering conservative lower‐level design options facilitates collaboration by providing risk‐averse actors with a safer solution. By accepting that decision‐making actors are not all risk‐neutral, future work seeks to develop new design methods to strengthen the adoption of efficient collaborative solutions.
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Strategic robustness in bi-level system-of-systems design
Abstract Robust designs protect system utility in the presence of uncertainty in technical and operational outcomes. Systems-of-systems, which lack centralized managerial control, are vulnerable to strategic uncertainty from coordination failures between partially or completely independent system actors. This work assesses the suitability of a game-theoretic equilibrium selection criterion to measure system robustness to strategic uncertainty and investigates the effect of strategically robust designs on collaborative behavior. The work models interactions between agents in a thematic representation of a mobile computing technology transition using an evolutionary game theory framework. Strategic robustness and collaborative solutions are assessed over a range of conditions by varying agent payoffs. Models are constructed on small world, preferential attachment and random graph topologies and executed in batch simulations. Results demonstrate that systems designed to reduce the impacts of coordination failure stemming from strategic uncertainty also increase the stability of the collaborative strategy by increasing the probability of collaboration by partners; a form of robustness by environment shaping that has not been previously investigated in design literature. The work also demonstrates that strategy selection follows the risk dominance equilibrium selection criterion and that changes in robustness to coordination failure can be measured with this criterion.
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- Award ID(s):
- 1943433
- PAR ID:
- 10352221
- Date Published:
- Journal Name:
- Design Science
- Volume:
- 8
- ISSN:
- 2053-4701
- Format(s):
- Medium: X
- Sponsoring Org:
- National Science Foundation
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- Free Publicly Accessible Full Text
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Accepted Manuscript1.0
- Journal Article:
- https://doi.org/10.1017/dsj.2022.2
