Automated Negotiations Yelena Yesha Olga Streltchenko 1 Automated Negotiations Issues in automated negotiations Auctions overview Electronic auctions e commerce servers 2 Negotiation in electronic commerce Negotiation key component in ecommerce Two or more parties multilaterally bargain resources for intended gain using the tools of electronic commerce e g agents negotiating a solution electronically Negotiating function is performed through networked computers 3 Automated Negotiation Auto negotiation is performed by computational agents which Represent real world parties Perform information retrieval and processing Find prepare contracts Perform other activities 4 Electronic marketplace Designated meeting place for negotiating parties A trusted intermediary that facilitates trading between buyers and sellers on the Web Closed marketplace predefined set of users enrollment Open marketplace agents enter and exit any time 5 Levels of automation Negotiation support systems Help human negotiations Intelligent Agents Negotiate electronically within an environment governed by rules No human intervention 6 Automation Architecture Issues for Automated Markets Transaction processing Decision support 7 Architecture Issues for Automated Markets Banking System E Market entities negotiating agents etc have to be able to communicate with the existing banking and financial services Integration of marketplace interfaces into banking legacy systems Open standard for agent to bank communications Security 8 Architecture Issues for Automated Markets Communication Infrastructure Efficiency and robustness Redundancy E g a mesh of redundant hubs interconnected with each other Open standard communication systems to allow development of platform independent systems that plug into a marketplace architecture Independent of agent architectures Agents must access global posting services use common language for outbound communications 9 Standardized Communication Infrastructure Integration into the back ends of electronic catalog databases and existing EDI systems Common language for outbound communications KQML 10 Architecture Issues for Automated Markets Transfer and storage of goods Representation and handling of physical goods Goods as software objects Copy protection to insure that an object is at one place at a time encoding by an owner access by agents authorized by the owner Arrangement for physical shipment 11 Architecture Issues for Automated Markets Handling of Electronic Items Format of a software object Copy protection as above Delivery channels 12 Architecture Issues for Automated Markets Administration and Policies Central administration to provide default protection prevention of illegal transactions collection of taxes and commissions credit and service ratings for agents 13 Self interested Agents SI vs Cooperative Distributed Problem Solving CDPM Self interested agents act according to their internal considerations and pursue their private goals E g internal utility function maximization Competitive A multi agent system may strive to achieve a global societal goal E g global utility function maximization Requires cooperation on the part of individual agents Common goal in a distributed system 14 Transaction Processing Levels of commitment For SI agents contracts are bounding In CDPS commitments are allowed to be broken unilaterally based on some local reasoning Continuous levels of commitment based on a monetary penalty method 15 Transaction Processing Decommitting Replies vs timeout Inform the other party that the negotiation is not considered any more 16 Transaction Processing Message congestion Most distributed implementations run into this problem high risk of saturation 17 Message Congestion cont d Remedies Focused addressing Heavy load agents with free resources or agents soliciting contracts announce availability Light load agents with tasks or agents offering contracts announce availability Audience restriction An agent negotiates with a subset of agents in the system Ignoring outdated messages 18 Decision Support Learning Creating an agent with a complete set of strategies no learning vs Acquisition of experience from the previous negotiations learning Genetic algorithms and genetic programming Q learning reinforced learning Other techniques Learning is computationally expensive 19 Decision Support Perfect Rationality vs Bounded Rationality Two approaches Microeconomics e g Kreps 1990 Varian 1992 and Raifa 1982 and distributed artificial intelligence DAI Rosenschein and Zlotkin 1994 Durfee 1994 Perfect rationality assumes that an agent can accurately model the environment and perform exact calculation for their decisionmaking computation is complex and resource time consuming 20 Perfect Rationality vs Bounded Rationality cont d Bounded rationality means that resources are costly and bounded and the model of the environment is not accurate e g the environment is dynamic and evolves An agent has to decide how much computation to perform per task contract choose a subset of tasks contracts available for consideration 21 Combinatorial Aspects of Negotiation Negotiating with several agents or several marketplaces at a time Computation complexity 22 Automated Negotiations What s lacking Why does current electronic commerce not widely support negotiations Negotiation is difficult Stumbling blocks Need for a clear unambiguous ontology Need for a strategy 23 Ontologies Ontology is a way of categorizing objects such that they are semantically meaningful to a software agent Must capture all important attributes of an object to allow for intelligent bargaining on both sides of a negotiation process Active research area in AI see for example Sowa 1999 Existing tools KIF Knoledge Intergande Format Ontolingua DAML 24 Strategy Game theory Treats negotiation from a mathematical prospective Recommends a course of actions to a participant taking into account the opponents strategies and payoffs Allows formulation of moves beyond pure price determination 25 Strategy cont d Disadvantages of the game theoretic approach Assumes perfect information identically perceived by all bargaining parties Information is asymmetric expectations are heterogeneous Assumes perfect rationality of all players Computational agents operate under constraints i e have bounded rationality 26 Automated Negotiations What s lacking cont d Sophisticated strategies are mathematically complex and computationally expensive Current
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