Master Course
Algorithmic Game Theory (AGT)
Updates
This course will be given at the University of Amsterdam (Science Park) and starts on Monday, September 4, 2023.
Note: This page serves as an overview site only. More details concerning the course will be provided through the respective canvas page of the course (in due time).
Background
Algorithmic Game Theory (AGT) is an interdisciplinary research area that lies in the intersection of Theoretical Computer Science, Discrete Mathematics and Economic Theory. The area builds upon game-theoretic foundations to study situations of strategic decision making, with a particular focus on computational and algorithmic aspects. It combines methodologies and techniques from several disciplines such as complexity theory, algorithm design, discrete and continuous optimization, online decision making and learning, auction and mechanism design, etc.
Course Contents
In this course, we study the existence, computation and inefficiency of equilibria (ranging from pure Nash equilibria to coarse correlated equilibria and learning outcomes) for various classes of games. We also consider the problem of designing coordination mechanisms to reduce the inefficiency. Further, we touch upon the computational limitations that arise in classic auction theory and learn about techniques to develop simple and efficient algorithms for fundamental mechanism design problems.
Objectives
The overall aim of the course is to get acquainted with fundamental methodologies, techniques and results in AGT. Throughout the course, we will build up a toolbox of models and techniques to study the impact of strategic decision making in various settings and to develop efficient algorithms for such environments.
The expected learning outcomes of the course are listed below:
Learn how to use game-theoretic models to study situations of strategic decision making.
Understand and identify the computational limitations and algorithmic challenges that arise.
Study and learn fundamental results on the existence, computation and inefficiency of equilibria.
Build up a toolbox of models and techniques to study the impact of strategic decision making.
Learn how to design simple and efficient algorithms for computationally hard mechanism design settings.
Topics
The main topics that will be covered in this course are:
selfish routing games and the price of anarchy
Braess paradox, Stackelberg routing, network tolls
best-response dynamics and potential games
existence, computation and inefficiency of equilibria
equilibrium hierarchy and no-regret learning
smoothness and extension theorems
auctions (single-item, single-parameter, combinatorial, generalized second price)
simple vs. optimal mechanism design
matching markets and envy-freeness
(see below for a more detailed overview of the different modules of the course)
Course Organization
This course is part of the Master of Logic and the Master of Artificial Intelligence and will be given at the University of Amsterdam (Science Park).
The course starts on Monday, September 4, 2023 and ends on Thursday, October 19, 2023.
There will be two lectures and one tutorial session offered each week.
Lectures:
Monday: 15:00–17:00
Thursday: 15:00–17:00
Tutorials:
Wednesday: 15:00–17:00
Lecturer and Teaching Assistant
The course will be given by Guido Schäfer.
Prof. Dr. Guido Schäfer
Networks and Optimization Group, Centrum Wiskunde & Informatica
Institute for Logic, Language and Computation, University of Amsterdam
Email: g.schaefer@cwi.nl
Please feel free to approach me if you have any questions, comments or remarks related to the course.
Danish Kashaev will be the teaching assistant of the course.
Assignments
Assignments will be issued throughout the course and graded.
We will probably allow for a mix of individual and group assignments (exact setup to be determined).
We will also ask you to study some material on your own.
Prerequisites
Solid background knowledge of the following topics:
complexity theory: worst-case analysis, P vs NP, NP-completeness
algorithms: basic algorithms (e.g., shortest path, matching, min-cost flow), knowledge of approximation algorithms is advantageous
optimization: linear programming, duality, basic knowledge of convex optimization is advantageous
Basic knowledge of game theory
Mathematical maturity: students are are expected to have prior experience with working out and writing up mathematical proofs.
References to standard textbooks to read up on relevant background (if needed) can be provided upon request.
Literature
Lecture Notes covering most of the material covered throughout the course will be provided.
The following books contain most of the material covered in class and are good references if you want to learn more.
Main references:
[NRTV07]
N. Nisan, T. Roughgarden, E. Tardos, and V. V. Vazirani (Editors), Algorithmic Game Theory, Cambridge University Press, 2007.
Note: The full-text of the book (pdf) seems to be available online.
[Rou16]
T. Roughgarden, Twenty Lectures on Algorithmic Game Theory, Cambridge University Press, 2016.
Note: The full-text of the book (pdf) seems to be available online.
Additional background reading:
[SLB16]
Y. Shoham and K. Leyton-Brown, Multiagent Systems, Cambridge University Press, 2009.
Note: The full-text of the book (pdf) is available here.
[KP16]
A. R. Karlin and Y. Peres, Game Theory, Alive, American Mathematical Society, 2016.
Note: The full-text of the book (pdf) is available here.
Modules
The course is subdivided into four main modules. An outline is given below (might still be adapted throughout the course).
Introduction: Some Highlights and Pheomena in AGT
Module 1: Potential Games and their Connections to Congestion Games
Strategic games and existence of pure Nash equilibria (PNE)
improving moves algorithms, better and best response dynamics
finite improvement property (FIP)
Potential games
exact, ordinal, generalized potential games
equivalence generalized potential games and the FIP
relation to congestion games
examples: connection games, congestion games, load balancing games, scheduling games
Computing PNE in potential games
Polynomially local search problems (PLS)
PLS-reduciblibility, PLS-completeness
computing PNE in congestion games is PLS-complete
Techniques to bound the inefficiency
POS: potential function method
POA: outlook: smoothness framework
Strong equilibria
Module 2: Non-Atomic Selfish Routing Games
Wardrop model and selfish routing
existence and computation of Nash flows
Karush Kuhn Tucker optimality conditions for convex programming
characterization of Nash flows and social optima
Inefficiency of equilibria and the price of anarchy
price of anarchy is independent of network topology
proof template for upper bound
tight lower bounds
Coping with selfishness:
Braess paradox
network tolls
Stackelberg routing
Module 3: Equilibrium Hierarchy
equilibrium notions:
Mixed Nash equilibria
Correlated equilibria
Coarse correlated equilibria
online decision making and learning outcomes
approximate equilibria
existence and computational issues
smoothness of games and extension theorems
Module 4: Auctions and Mechanism Design
Warm-up: Vickrey auction
single-item auction and objectives
second-price auction
strategyproofness
VCG mechanism for combinatorial auctions
combinatorial auction model
VCG mechanism and extensions
truthfulness and pitfalls
Generalized second-price auctions (GSP)
GSP and sponsored search
model and deficiencies of GSP
detour: existence of pure Nash equilibria
matching markets
existence of market clearing prices
ascending price algorithm and its termination
price of anarchy of GSP
Single-parameter setting
Myerson's Lemma: characterization of truthful mechanisms
mechanism design and approximation algorithms
procurement auctions: knapsack auction, shortest-path auction
extension: single-minded bidders
Mechanism Design without Payments