Strategic interactions in the TAC 2003 supply chain tournament

Abstract

The TAC 2003 supply-chain game presented automated trading agents with a challenging strategic problem. Embedded within a complex stochastic environment was a pivotal strategic decision about initial procurement of components. Early evidence suggested that the entrant field was headed toward a self-destructive, mutually unprofitable equilibrium. Our agent, DEEP MAIZE, introduced a preemptive strategy designed to neutralize aggressive procurement, perturbing the field to a more profitable equilibrium. It worked. Not only did preemption improve DEEP MAIZE'S profitability, it improved profitability for the whole field. Whereas it is perhaps counterintuitive that action designed to prevent others from achieving their goals actually helps them, strategic analysis employing an empirical game-theoretic methodology verifies and provides insight into the reasons of this outcome. © Springer-Verlag Berlin Heidelberg 2006.