dorsal/arxiv
View SchemaCities at Play: Improving Equilibria in Urban Neighbourhood Games
| Authors | Martin Gairing, Adrian Vetta, Zhanzhan Zhao |
|---|---|
| Categories | |
| ArXiv ID | 2601.08642vv1 |
| URL | https://arxiv.org/abs/2601.08642 |
| License | http://creativecommons.org/licenses/by/4.0/ |
Abstract
How should cities invest to improve social welfare when individuals respond strategically to local conditions? We model this question using a game-theoretic version of Schelling's bounded neighbourhood model, where agents choose neighbourhoods based on concave, non-monotonic utility functions reflecting local population. While naive improvements may worsen outcomes - analogous to Braess' paradox - we show that carefully designed, small-scale investments can reliably align individual incentives with societal goals. Specifically, modifying utilities at a total cost of at most $0.81 \epsilon^2 \cdot \texttt{opt}$ guarantees that every resulting Nash equilibrium achieves a social welfare of at least $\epsilon \cdot \texttt{opt}$, where $\texttt{opt}$ is the optimum social welfare. Our results formalise how targeted interventions can transform supra-negative outcomes into supra-positive returns, offering new insights into strategic urban planning and decentralised collective behaviour.
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"date_created": "2026-02-17T05:53:16.247000Z",
"date_modified": "2026-02-17T05:53:16.247000Z",
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"abstract": "How should cities invest to improve social welfare when individuals respond strategically to local conditions? We model this question using a game-theoretic version of Schelling\u0027s bounded neighbourhood model, where agents choose neighbourhoods based on concave, non-monotonic utility functions reflecting local population. While naive improvements may worsen outcomes - analogous to Braess\u0027 paradox - we show that carefully designed, small-scale investments can reliably align individual incentives with societal goals. Specifically, modifying utilities at a total cost of at most $0.81 \\epsilon^2 \\cdot \\texttt{opt}$ guarantees that every resulting Nash equilibrium achieves a social welfare of at least $\\epsilon \\cdot \\texttt{opt}$, where $\\texttt{opt}$ is the optimum social welfare. Our results formalise how targeted interventions can transform supra-negative outcomes into supra-positive returns, offering new insights into strategic urban planning and decentralised collective behaviour.",
"arxiv_id": "2601.08642",
"authors": [
"Martin Gairing",
"Adrian Vetta",
"Zhanzhan Zhao"
],
"categories": [
"cs.GT",
"econ.TH"
],
"license": "http://creativecommons.org/licenses/by/4.0/",
"title": "Cities at Play: Improving Equilibria in Urban Neighbourhood Games",
"url": "https://arxiv.org/abs/2601.08642",
"version": "v1"
},
"schema_id": "dorsal/arxiv",
"source": {
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"id": "arXiv Dataset",
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"variant": "snapshot-2026-01-17",
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