Game Theory in response to Natural Disasters
https://theconversation.com/response-to-natural-disasters-like-harvey-could-be-helped-with-game-theory-83125
After every natural disaster there is always a moment when our country comes together and signals togetherness, acts as a shoulder for many to cry on and looks to see what the people who weren’t directly affected can do to help those in need. When looking to see what they can do, people who were not affected often tun to and send donations to one of the many non-profit organisations that are being marketed on social media and television commercials. After sending supplies to one of these organisations- people most likely feel that they have directly helped and that their donation went directly to a community in need- but due to the lack of communication and game theory used among NGOs, this isn’t always the case.
While it may feel weird to view the non-profit disaster relief companies as competitors- in terms of raising capital- they absolutely are: (from the article) in 1940 there were 12,000 registered US non-profits- now there are more then 1.5 million (as of 2012) and these organisations are competing for approximately $300 billion that is donated to charities in the United States every year. And as these organisations compete for resources, they do operate under a single, common, humanitarian principle of protecting the vulnerable and, reducing suffering and supporting the quality of life.
This article talks about the author and their colleague’s research in modeling how the decisions that individual NGO’s make when distributing the resources they received may differ from the socially optimal decision. Many decisions that the team specifically looked at were ones that (without communication and strategy among other NGOs) looked like the optimal solution- but after allowing communication between the NGOs- became clear that these decisions, while being optimal for the individual NGO- were not socially optimal for the community at large.
The researches talked about specific disasters, (such as 2010 earthquake in Haiti and Hurricane Katrina in 2005) where about 60 percent of the items that were arriving at disaster sites (items transported by the NGOs that were given as donations from people) were non-priority items. These items would clog up the disaster relief supply chain- and stop needed items from quickly getting to the people affected.
The researches talk about how they used high level game theory simulations (out of the scope of this class) to try and see how communication between the NGOs could best fix this excess inventory of non-priority items and best decide how to actually distribute the items people in the community need.
When I first starting reading these researchers talking about tragedy in terms of supply and demand and NGOs competing against each other I will admit I was completely skeptical of their project and I wrongly assumed this paper would spiral into academics complaining about how government regulations (such as price controls and environmental laws) and the state’s laws were holding back the solution that the free-market was ready to provide. But I was wrong- these researchers took market oriented ideals and applied it to the behavior among NGOs during times of crisis and came up with a rather concrete set of practices that, if adopted, could potentially allow the distribution of these scarce resources to be much more efficient and help a lot more people.