Adversarial issues in reliability

Many reliability problems involve two or more agents with conflicting interests whose decisions affect the performance of the system at hand. Examples of such problems relevant in management practice abound and include acceptance sampling, life testing, software testing, optimal maintenance, reliability demonstration, warranties and insurance. Most earlier attempts in such problems have focused on game theoretic approaches based on Nash equilibria and related concepts. However, these require strong common knowledge assumptions which do not frequently hold in practice. We provide an alternative framework based on adversarial risk analysis to deal with such problems which avoids the strong common knowledge assumptions of game theory. We illustrate the framework through acceptance sampling and life testing problems.