Methodologies for the design of negotiation protocols on E-markets

Abstract Markets play a central role in the economy, facilitating the exchange of information, goods, services, and payments. In recent years, there has been an enormous increase in the role of information technology, culminating in the emergence of electronic marketplaces. Negotiations are at the core of each negotiation. Economists, game theorists and computer scientists have started to take a direct role and designed different kinds of negotiation protocols for computer products, travel, insurances, or electric power. The design of negotiation protocols is a challenging research direction and involves a number of disciplines including information systems development, game theory, mechanism design theory, simulation and laboratory experimentation. In this paper we survey the key techniques for the design of negotiation protocols and describe the main steps in the design of a multi-attribute auction protocol for a financial market. The case illustrates the interplay of the various methodologies.

[1]  L. Tesfatsion.  A Trade Network Game With Endogenous Partner Selection , 1997 .

[2]  Elmar G. Wolfstetter.  AUCTIONS: AN INTRODUCTION , 1996 .

[3]  Paul R. Milgrom,et al.  A theory of auctions and competitive bidding , 1982 .

[4]  L. Hurwicz.  The Design of Mechanisms for Resource Allocation , 1973 .

[5]  John. Moore,et al.  Stopping agents from “cheating” , 1988 .

[6]  T. Bewley.  Advances in Economic Theory: Fifth World Congress , 2009 .

[7]  Yannis Bakos,et al.  A Strategic Analysis of Electronic Marketplaces , 1991, MIS Q..

[8]  Robert T. Clemen,et al.  Making Hard Decisions: An Introduction to Decision Analysis , 1997 .

[9]  J. Nash.  THE BARGAINING PROBLEM , 1950, Classics in Game Theory.

[10]  J. Nash.  Two-Person Cooperative Games , 1953 .

[11]  A. Rubinstein.  Perfect Equilibrium in a Bargaining Model , 1982 .

[12]  W. Arthur,et al.  The Economy as an Evolving Complex System II , 1988 .

[13]  V. Smith.  Microeconomic Systems as an Experimental Science , 1982 .

[14]  T. Saaty,et al.  The Analytic Hierarchy Process , 1985 .

[15]  R. Selten,et al.  A Generalized Nash Solution for Two-Person Bargaining Games with Incomplete Information , 1972 .

[16]  L. Telser,et al.  The Usefulness of Core Theory in Economics , 1994 .

[17]  Yeon-Koo Che.  Design competition through multidimensional auctions , 1993 .

[18]  Hans M. Amman,et al.  Computational approaches to economic problems , 1997 .

[19]  R. McAfee,et al.  Auctions and Bidding , 1986 .

[20]  櫻井 祐子,et al.  Hal R. Varian: Economic Mechanism Design for Computerized Agents, the First Usenix Workshop on Electronic Commercr (1995). , 2000 .

[21]  P. Samuelson,et al.  Foundations of Economic Analysis. , 1948 .

[22]  Y. Kwok.  Mathematical models of financial derivatives , 2008 .

[23]  Ronald M. Harstad,et al.  Modeling Competitive Bidding: A Critical Essay , 1994 .

[24]  J. Eliashberg,et al.  An analytical process model of two-party negotiations , 1995 .

[25]  J. Banks,et al.  Allocating uncertain and unresponsive resources: an experimental approach. , 1989, The Rand journal of economics.

[26]  J. Kagel,et al.  Handbook of Experimental Economics , 1997 .

[27]  J. Neumann,et al.  Theory of games and economic behavior , 1945, 100 Years of Math Milestones.

[28]  A. Gibbard.  Manipulation of Voting Schemes: A General Result , 1973 .

[29]  F. Branco.  The Design of Multidimensional Auctions , 1997 .

[30]  Stephen J. Rassenti,et al.  Designing a Uniform-Price Double Auction: An Experimental Evaluation , 1993 .

[31]  Alvin E. Roth,et al.  Game Theory as a Tool for Market Design , 2000 .