A beautiful game theory for co-operation in delta
A Hong Kong academic has helped to produce a mathematical theory that could improve the benefits resulting from greater co-operation in the Pearl River Delta region.
David Yeung Wing-kay, director of Baptist University's Centre of Game Theory, said the model could help each city gain a better idea of what and when they would gain before co-operating.
Noting that regional co-operation was a textbook case in game study, Professor Yeung said the key issue was how to distribute gains so that each city could get the optimal benefits.
He cited the building of a bridge linking Hong Kong, Macau and Zhuhai to illustrate the possibility that there might be disparity in gains among the cities as the size of their economies differed and they could change over time.
'For instance, co-operation between two cities with vastly different gross national product has generated a total gain of $2 billion. If each gets an equal share, it is not fair in some sense,' he said.
One key element was that a participant would get a growing share of economic gain in proportion to a forecast of its gross national product growth. 'This is a mathematical solution, we believe it can be applied [to PRD co-operation],' Professor Yeung said.
The findings, jointly conducted by Professor Yeung and Leon Petrosyan, a professor of St Petersburg State University, was published in the latest issue of the Journal of Optimisation Theory and Applications.
Game theory, a study of decision-making in an interactive environment, was the subject of the film A Beautiful Mind, about Nobel laureate John Nash.
