Forming Alliances in the Fog of War: A General Lotto Perspective

Abstract

Agents competing against a common opponent can often gain an edge by forming alliances, but deciding whether to do so is difficult when they lack precise knowledge about their opponent or ally. We study how uncertainty affects opportunities for alliance formation in the coalitional General Lotto game, in which two players compete aganist a shared adversary by allocating their resource budgets over separate sets of valued contests. When all agents know one another's budgets, it is known that a budget transfer from one player to the other can benefit both players. We ask whether such alliances survive when the players know the relevant budgets only up to a multiplicative factor. Under two models, one in which the players are uncertain about the adversary's budget and one in which they are uncertain about each other's budgets, we characterize exactly which games admit a transfer that benefits both players in every game consistent with what they conjecture to be possible. In both models, we show that such robust transfers exist in a set of games of positive measure for every level of uncertainty. These results suggest that alliances can remain worthwhile even when allies are largely in the dark.