We consider clustering games in which the players are embedded into a network and want to coordinate (or anti-coordinate) their strategy with their neighbors. The goal of a player is to choose a strategy that maximizes her utility given the strategies of her neighbors. Recent studies show that even very basic variants of these games exhibit a large Price of Anarchy: A large inefficiency between the total utility generated in centralized outcomes and equilibrium outcomes in which players selfishly maximize their utility. Our main goal is to understand how structural properties of the network topology impact the inefficiency of these games. We derive topological bounds on the Price of Anarchy for different classes of clustering games. These topological bounds provide a more informative assessment of the inefficiency of these games than the corresponding worst-case Price of Anarchy bounds. More specifically, depending on the type of clustering game, our bounds reveal that the Price of Anarchy depends on the maximum subgraph density or the maximum degree of the graph. Among others, these bounds enable us to derive bounds on the Price of Anarchy for clustering games on Erdős-Rényi random graphs. Depending on the graph density, these bounds stand in stark contrast to the known worst-case Price of Anarchy bounds. Additionally, we characterize the set of distribution rules that guarantee the existence of a pure Nash equilibrium or the convergence of best-response dynamics. These results are of a similar spirit as the work of Gopalakrishnan et al. [19] and complement work of Anshelevich and Sekar [4].

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ACM Transactions on Economics and Computation
Networks and Optimization

Kleer, P., & Schäfer, G. (2023). Topological bounds on the Price of Anarchy of clustering games on networks. ACM Transactions on Economics and Computation, 11(3-4), 1–31. doi:10.1145/3625689