Game-Theoretical Approach to Strategic Planning in Regulatory Market Surveillance

This paper presents an inquiry into the applicability of basic principles of Game Theory to the field of Market Surveillance. It identifies an optimal market surveillance strategic plan based on the prevailing and the desired market conditions. It further establishes an exponential relationship governing the number of possible outcomes in any n-person game given the number of players and the number of available strategies and its implications from a regulatory point of view, and introduces the idea of the optimal path to equilibrium point as a decision-making tool.