Fault-Tolerant Hotelling Games

Abstract: The $n$-player Hotelling game calls for each player to choose a point on the line segment, so as to maximize the size of his Voronoi cell. This paper studies fault-tolerant versions of the Hotelling game. Two fault models are studied: line faults and player faults. The first model assumes that the environment is prone to failure: with some probability, a disconnection occurs at a random point on the line, splitting it into two separate segments and modifying each player's Voronoi cell accordingly. A complete characterization of the Nash equilibria of this variant is provided for every $n$. Additionally, a one to one correspondence is shown between equilibria of this variant and of the Hotelling game with no faults. The second fault model assumes the players are prone to failure: each player is removed from the game with i.i.d. probability, changing the payoffs of the remaining players accordingly. It is shown that for $n \geq 3$ this variant of the game has no Nash equilibria.