Social Context in Potential Games

The prevaling assumption in game theory is that all players act in a purely selfish manner, but this assumption has been repeatedly questioned by economicsts and social scientists. In this paper, we study a model to incorporate social context, i.e., the well-being of friends and enemies, into the decision making of players. We consider the impact of such other-regarding preferences in potential games, one of the most popular and central classes of games in algorithmic game theory. Our results concern the existence of pure Nash equilibria and potential functions in games with social context. The main finding is a tight characterization of the class of potential games that admit exact potential functions for any social context. In addition, we prove complexity results on finding pure Nash equilibria in numerous popular classes of potential games, such as different classes of load balancing, congestion, cost and market sharing games.