Game Theory-Based Allocation of Critical Resources during Natural Disasters

Abstract

Allocation of limited resources in a fair manner is essential after a natural disaster, especially if multiple emergencies occur at the same time. In this paper, a resource allocation methodology is proposed based on a two-player, non-cooperative, strategic form game where the crisis events, assumed to occur at different locations, are considered as the players. The objective is to obtain an optimal strategy for the individual players which leads to an effective allocation of an indivisible resource when the availability of the resource is insufficient to satisfy the need of all the players of the game. Each player incurs a cost for demanding resources based on a non-monetary cost function which is used to generate the game matrices. The cost function is formulated such that collective good and fair sharing are incentivised. It is shown that at least one pure strategy Nash equilibrium (PSNE) always exists for the formulated game. A desirable resource allocation strategy is obtained from PSNEs by applying the concepts of payoff and risk dominance.