Three Concepts: Utility | Projects
The class of goods called common pool resources (CPR) is a natural or man-made resource system with two characteristics: first, the resource is depletable or subtractable, and secondly, it is either impossible or costly to exclude anyone from using the resource. Some examples of CPR are pasture, ground water, irrigation systems, forests, and fisheries. A CPR system is vulnerable to abusive practices, and eventually the loss of the resource.
This leads to the tragedy of the commons, a social dilemma in which individually rational behaviors collectively can lead to an irrational outcome. The commons is a public resource of goods shared by a group of people, for instance households. Each participant in the commons can utilize its share of the commons and enjoy the benefits of doing so, while the cost of utilization is shared between the participants. Therefore the cost appears negligible compared to the gain for each participating household. Furthermore, the accumulating wealth allows some households to utilize the commons even more.
Consequently, they end up acquiring the resource more than their fair share, i.e., they over-exploit, while paying less than their fair share of the total cost. Eventually, the resource is exhausted and the commons collapse. Thus the 'tragedy'.
The tragedy of commons was popularized by Garrett Hardin in his 1968 Science essay The Tragedy of the Commons. He also argued that there is no technical solution to the tragedy, but addresses some management solutions including privatization, regulation, and making the participants pay for the commons.
You may familiarize yourself with the dilemma playing Tragedy of the Bunnies.
Let's assume a system with a number of households (four in this case, one per group), each with a finite endowment of k units, which they can invest in the common pool resources (called CPR market). Alternatively, the households can partly or entirely withdraw from investing to CPR and invest to a "private market" instead.
The household's payoff from the CPR market is determined by its own investment, but also the total amount invested in the CPR market by all the households. The payoff derived from the private market only depends on the amount invested to the private market by the particular household. The actual payoff structure is not known by the households besides that there is no stochasticity. The payoff function for the CPR does not change, but the payoff from the private market may change over time non-randomly.
Each household makes their investment simultaneously, i.e., they do not know each others' investments.
This is how the game goes:
The game is played several times. Each game consists of a number of decision rounds, which are alike and totally independent from each other, for instance, earlier decisions do not influence future payoffs. A single game ends after a predetermined maximum number of rounds is reached or a tragedy happens: the tragedy materializes as a negative payoff, if the household invested in the CPR. The household payoffs are accumulated over rounds and over games.
Your task is to implement your household's decision strategy for the above game.
Your household will receive the following information:
When the tragedy happens, the households are informed about the fact, and the round counter is reset to maximum.
Your program is started with the following command line arguments: 1) number of games to be played, 2) maximum number of rounds to be played, and 3) and the endowment (k). It then enters a loop in which it makes the investment decision, writes it to standard output, and reads the payoff information from standard input. More specifically the output and the input of your program are:
You can test your household's strategy using the host and a random player found in this packet. Note, that the included payoff function is not the final one; you need write your own function.
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| Three Concepts: Utility | |