Facility Location Games with Group Externalities

Houyu Zhou

Abstract: We develop a formal model of facility location games with group externalities in one dimension: there is a set of agents on an interval [0, L], a facility will be built to serve both the individual activities and the group activities. Some agents are interested in individual activities, while others like group activities. The goal is to design a mechanism that is non-manipulable and respects unanimity while (approximately) optimizing an objective function. We consider two social objectives, the social utility and the minimum utility. We prove that some previous mechanisms cannot handle this scenario. For each objective, we discuss about different ways of manipulation, and show both upper bounds and lower bounds of approximation ratios for deterministic truthful mechanisms.