Biblio

We study the problem of designing a dynamic mechanism for security management in an interconnected multi-agent system with N strategic agents and one coordinator. The system is modeled as a network of N vertices. Each agent resides in one of the vertices of the network and has a privately known security state that describes its safety level at each time. The evolution of an agent's security state depends on its own state, the states of its neighbors in the network and on actions taken by a network coordinator. Each agent's utility at time instant t depends on its own state, the states of its neighbors in the network and on actions taken by a network coordinator. The objective of the network coordinator is to take security actions in order to maximize the long-term expected social surplus. Since agents are strategic and their security states are private information, the coordinator needs to incentivize agents to reveal their information. This results in a dynamic mechanism design problem for the coordinator. We leverage the inter-temporal correlations between the agents' security states to identify sufficient conditions under which an incentive compatible expected social surplus maximizing mechanism can be constructed. We then identify two special cases of our formulation and describe how the desired mechanism is constructed in these cases.