Abstract

The distinctive characteristic of a “Reversed Stackelberg Game” is that the leader playstwice, first by announcing his future action, second by implementing a possibly differentaction given the follower's reaction to his announcement. In such a game, if the leader usesthe normal Stackelberg solution to find (and announce) his optimal strategy, there is a strongtemptation for him to cheat, that is, to implement another action than the one announced. Inthis paper, within the framework of a standard discrete time Linear‐Quadratic DynamicReversed Stackelberg game, we discuss and derive the best possible open‐loop cheatingstrategy for an unscrupulous leader.

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