EPSRC Reference: 
EP/N021282/1 
Title: 
A compositional approach to gametheoretic economic modelling 
Principal Investigator: 
Hedges, Dr J 
Other Investigators: 

Researcher CoInvestigators: 

Project Partners: 

Department: 
Computer Science 
Organisation: 
University of Oxford 
Scheme: 
EPSRC Fellowship 
Starts: 
06 June 2016 
Ends: 
05 June 2019 
Value (£): 
259,304

EPSRC Research Topic Classifications: 
Fundamentals of Computing 
Logic & Combinatorics 

EPSRC Industrial Sector Classifications: 
No relevance to Underpinning Sectors 


Related Grants: 

Panel History: 

Summary on Grant Application Form 
Game theory is the mathematical study of strategic interaction and decisionmaking under uncertainty. It is arguably the central tool of microeconomics, and is also widely used in evolutionary biology, cybersecurity and military strategy, among other application areas.
Compositionality, one of the most fundamental ideas of software science, is the principle that the behaviour of a system should be understandable in terms of the behaviour of its components. Compositionality allows large, complex systems to be designed, implemented, analysed and tested in a modular way, and allows modules to be reused in different contexts. Without this, modern software engineering would be impossible.
Game models, however, are not compositional, and generally must be produced in their entirety rather than by combining standard components. As a result, gametheoretic modelling is a slow process, as small variations in the domain to be modelled can lead to large changes needed in the model. In particular this means that gametheoretic models are currently not wellsuited to software implementation.
This project concerns a new approach to game theory which is compositional, and therefore promises the possibility of software support for economists and other users of game theory on a scale that is currently impossible. Specifically, it should be possible to specify, simulate, solve and more generally reason about games in a way that allows the reuse of existing work. For example a typical economic system has a hierarchical structure, from agents to households to markets to economies, and it should be possible to gradually build models of each level in a way that directly uses existing models of the lower levels.
The mathematical techniques and concepts underlying this approach mostly come from proof theory (part of mathematical logic) and the theory of programming languages (part of theoretical computer science). Fortunately there is no need for users to learn this sophisticated and (to them) unfamiliar theory, because it is also possible to hide the mathematics behind an intuitive graphical language known as string diagrams, which have been widely studied recently due to applications in quantum information theory, linguistics and abstract algebra. This means that game theoretic software can be graphical and intuitive, but still have a strong theoretical underpinning.
The purpose of this project is to develop the mathematical theory needed for these economic applications, in a way that exploits the close relationship between theory and applications in this area, while using a worked example (based on modelling of smart energy grids) to provide a continual test of the practical benefits of compositionality.
A large part of the theoretical part of this project will involve extending the theory of selection functions with various known concepts in game theory, such as repeated games, imperfect information and different solution concepts, which can be found in any standard text on game theory. This will largely consist of generalising existing theory to the new framework.

Key Findings 
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Potential use in nonacademic contexts 
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Impacts 
Description 
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Summary 

Date Materialised 


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Project URL: 

Further Information: 

Organisation Website: 
http://www.ox.ac.uk 