An approach to discrete-time incentive feedback Stackelberg games

A substantial effort has been devoted to various incentive Stackelberg solution concepts. Most of these concepts work well in the sense that the leader can get his desired solution in the end. Yet, most incentive strategies developed thus far include either the follower’s control, which may not be realistic in practice, or delays in the state, which makes stabilization more difficult to achieve. In this paper, we obtain the team-optimal state feedback Stackelberg strategy (with no delays) of an important class of discrete-time two-person nonzero-sum dynamic games characterized by linear state dynamics and quadratic cost functionals.