GAME-THEORETIC MODEL OF INSPECTION-RESOURCE ALLOCATION.

This work presents a generalization of a game-theoretic model of the relationship between an inspectee who may decide to ″cheat″ or not, and an inspector whose task it is to minimize the expected gain that the inspectee achieves by cheating. When cheating is detected by the inspector, a penalty is assessed against the inspectee. The generalized model permits imposing a relationship between the level of the penalty to the inspectee when he/she is caught and the value to the inspectee of not being caught when he/she is cheating. The solution of the game takes on different forms depending on whether or not the inspector's resources are sufficient to make the detection of cheating likely.