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Sabotage or Foul Penalty Schedule

Penalty-schedule rule — instantiates Bounded Rivalry Governance

A published tariff of penalties for off-arena moves — sabotage, fouls, deception, manipulation — that prices misconduct out of the winning strategy.

A Sabotage or Foul Penalty Schedule draws the line between legitimate competitive moves and fouls, and attaches a pre-declared, graduated penalty to each way of crossing it. The insight is behavioral: if attacking a rival or bending the rules pays better than competing straight, rivals will do it. A penalty schedule makes misconduct a losing move by ensuring its expected cost exceeds its expected gain. It governs how you may win — not who wins, and not what the score is.

Example

A trading venue publishes a penalty schedule for manipulative conduct. Spoofing — posting large orders you intend to cancel in order to nudge the price — draws escalating fines, disgorgement of any gains, and, on repetition, suspension of trading privileges. A firm tempted to spoof now weighs a fleeting edge against a known, escalating penalty and a suspension that would end its access entirely. Aggressive-but-legal strategies stay in bounds; the sabotage-style ones stop paying. (Spoofing is a real, prohibited practice, which is what lets a venue schedule penalties against it in advance.)

How it works

  • Enumerate the fouls — name which moves are off-arena: sabotage, collusion, deception, unsafe shortcuts.
  • Grade the penalties — escalate with severity and repetition (warning → fine → disgorgement → ban).
  • Pre-commit and publish — the cost is known before the temptation arises.
  • Trigger on detection and apply consistently across rivals.

The distinguishing move is that it does not try to produce good conduct; it makes bad conduct unprofitable, via a known tariff attached to the arena boundary.

Tuning parameters

  • Penalty severity vs. gain — the penalty must exceed the foul's expected benefit divided by the odds of being caught; too soft and it becomes a mere cost of doing business.
  • Graduation curve — how steeply penalties escalate with repetition and severity.
  • Assumed detection probability — low detection demands harsher penalties to hold deterrence constant.
  • Bright-line vs. judgment — hard-coded fouls (fast, predictable, brittle) versus discretionary rulings (flexible, contestable).
  • Reversibility — fines versus disqualification versus permanent ban; the harsher the ceiling, the more it deters and the more it risks over-punishing honest error.

When it helps, and when it misleads

Its strength is that it converts "don't cheat" from a hope into a priced constraint, protecting the arena boundary so competition stays about performance. Because penalties are graduated and published in advance, they are accepted as fair — the logic of graduated sanctions.[1]

Its central weakness is that a schedule only deters what is detected, so it is only as strong as the monitoring behind it. Set too low, it becomes a toll the well-resourced happily pay; set too high or too rigid, it punishes honest mistakes and chills legitimate aggression. Run backwards, penalties are enforced selectively against disfavored rivals while allies get a pass. The discipline is to pair the schedule with real detection, calibrate penalty against the odds of catching the foul, and apply it evenly.

How it implements the components

Sabotage/Foul Penalty Schedule realizes the conduct-boundary side of the archetype — the components that keep rivalry from turning destructive:

  • contest_arena_boundary — it defines the boundary by naming which moves are fouls and pricing each one.
  • anti_sabotage_and_anti_collusion_guardrail — the penalties are the guardrail that makes sabotage and secret coordination unprofitable.

It sets the price of misconduct but does not itself detect it (that's Anti-Collusion Monitoring and the audit in Ranked Leaderboard With Audit), nor cap the resources rivals may pour in legitimately (that's Spending Cap or Resource Cap).

Notes

A penalty schedule is only as strong as the detection feeding it: without a monitor behind it, published penalties deter only the honest, while the undetectable foul becomes the dominant strategy. Schedule and detector are a matched pair, not substitutes.

References

[1] Graduated sanctions — Elinor Ostrom's principle that durable rule systems penalize violations in proportion to severity and repetition, starting mild and escalating, rather than jumping straight to maximal punishment. Graduation is what keeps enforcement both credible and accepted. ↩