The Impact of Meta-Strategy on Attendance Dynamics in the El Farol Bar Problem

Abstract: The El Farol Bar Problem is a classic computational economics problem in which agents attempt to attend a weekly event at a bar only if it is not too crowded. Each agent has access to multiple competing strategies that may be used to predict whether attendance will be above the tolerance threshold. Many different variations of the El Farol Bar Problem have been published, with a particularly broad variation in the choice of meta-strategy, the algorithm by which each agent selects the best-performing strategy. This paper discusses the varying mechanisms of self-organization within the system when different meta-strategies are used, including the existence and location of fixed points in the limit of an infinite number of agents. Informed by these mechanisms, we present an evolutionary paradigm that reduces the likelihood of degenerate cases where attendance is always too high or too low, while reducing the amplitude of fluctuations in attendance. This evolutionary paradigm sheds light on the critical role of heterogeneity of strategies selected in the emergence of a stable steady state in the El Farol Bar Problem.