Abstract: Game theory is applicable to situations where decision-makers are competing for a limited resource. Game theory offers rational or limited rational justification for selecting strategies that lead to specific outcomes. Game theory has been used very successfully in economics, and it has also been applied in the social sciences, computer science, and biological sciences, among others. Game theory can be classified into two types: cooperative and noncooperative. In the field of reliability, the players in noncooperative games could be consumers, factories, retail networks, regulatory agencies, etc. Each player is assumed to act rationally to maximize its profit or minimize its effort. Ramamurthy's book (1990, Kluwer Academic Publishers) on cooperative game theory, titled Coherent Structures and Simple Games, was among the first to bridge the gap between reliability and game theory. Ramamurthy notes that a number of concepts, as well as the applications of game theory, were rediscovered only fairly recently by researchers in reliability. In this chapter, we formulate problems in the reliability field by defining them as games, and we define the players, strategies, payoff functions, and other elements that constitute game models. The major advantages of the method are that it can provide new ways to examine reliability problems and can often lead to novel solutions to these problems. The chapter discusses different types of games, such as static games, dynamic games, etc. Information on rules, kinds of strategies, and equilibrium solutions are also covered. Some of the classical game theory models are shown to have equivalent applications in the reliability field. In addition, numerical examples are presented in detail to demonstrate specific applications of game theory in reliability.
Publication Year: 2019
Publication Date: 2019-01-01
Language: en
Type: book-chapter
Indexed In: ['crossref']
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Cited By Count: 1
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