A game‐theoretic approach for the location of terror response facilities with both disruption risk and hidden information

Recently, locating emergency response facilities has been drawing increasing attention with the highly strategic nature of terrorist attacks. To this end, we present a game‐theoretic approach for the location of terror response facilities when both disruption risk and hidden information are taken into account. The game is described as a two‐stage game, in which the first stage allows the State, that is, defender, to locate the terror response facilities, including disclosed and undisclosed facilities, and assign them to the attacked city, while the second stage allows the terrorist, that is, attacker, to select one city to attack with partial information about facility location and assignment. We propose a mixed integer bi‐level nonlinear programming formulation, and in response, a heuristic algorithm is developed to find the equilibrium solution. Extensive computational tests on both synthetic data and a real‐world dataset of provincial capital cities in China demonstrate the effectiveness of the developed algorithm.