The next Economics Seminar of Paris-Saclay will take place on Thursday, Mars 31 from 12h15 to 13h15. Francis Bloch (Université Paris 1 Panthéon Sorbonne, Paris School of Economics) will present “Attack and interception in networks” (joint with Kalyan Chatterjee and Bhaskar Dutta).
This paper studies a game of attack and interception in a network, where a single attacker chooses a target and a path, and each node chooses a level of protection. We show that the Nash equilibrium of the game exists and is unique. It involves a mixed strategy of the attacker except when one target has a very high value relative to others. We characterize equilibrium attack paths and attack distributions as a function of the underlying network and target values. We also show that adding a link or increasing the value of a target may harm the attacker — a comparative statics effect which is reminiscent of Braess’s paradox in transportation economics. Finally, we contrast the Nash equilibrium with the equilibria of two variations of the model: one where nodes make sequential protection decisions upon observing the arrival of a suspicious object, and one where all nodes cooperate in defense.