Economics of Dynamic Pricing in a Reputation Brokered Agent Mediated Marketplace
We present a framework to study the microeconomic effects in a reputation brokered Agent mediated Knowledge Marketplace, when we introduce dynamic pricing algorithms. We study the market with computer simulations of multiagent interactions. In this marketplace, the seller reputations are updated in a collaborative fashion based on the performance of the user in the delegated tasks. To the best of our knowledge, this is the first agent mediated marketplace where the agents use dynamic pricing based on “dynamically” updated reputations. The framework can be used to investigate the different equilibria reached, based on the level of intelligence of the selling agents, the level of price-importance elasticity of the buying agents, and the level of unemployment in the marketplace. Preliminary experiments addressing these issues are presented.
KeywordsNash Equilibrium Price Strategy Optimal Price Minimum Utility Reputation Mechanism
Unable to display preview. Download preview PDF.
- 1.Chavez A, Maes P.: Kasbah: an agent marketplace for buying and selling goods. PAAM 96._ Proceedings of the First International Conference on the Practical Application of Intelligent Agents and Multi-Agent Technology. Practical Application Company. 1996, pp.75–90. Blackpool, UK.Google Scholar
- 2.Cliff, D. and Bruten, J.: “More Than Zero Intelligence Needed for Continuous Double-Auction Trading”, HP Technical Report HPL-97-157, CEFES’98, 1998 U. of Cambridge, England.Google Scholar
- 3.Friedman, E. and Resnick, P.: The Social Cost of Cheap Pseudonyms: Fostering Cooperation on the Internet. In Proceedings of the 1998 Telecommunications Policy Research Conference (1998). Alexandria, VA. Lawrence Erlbaum Associates, Inc., Mahwah, NJ.Google Scholar
- 5.Kollock, P. The Production of Trust in Online Markets, Advances in Group Processes, vol. 16, (1999), E. J. Lawler, M. Macy, S. Thyne, and H. A. Walker (eds), JAI Press, Greenwich, CT.Google Scholar
- 6.Moukas, A., Zacharia, G., Guttman, R., Maes, P. Agent-mediated electronic commerce: an MIT Media Laboratory perspective. International Journal of Electronic Commerce, vol.4, no.3, (Spring 2000), pp.5–21. M.E. Sharpe, Armonk, NY, USA; ISSN: 1086-4415Google Scholar
- 7.Oliver, J. Artificial agents learn policies for multi-issue negotiation. International Journal of Electronic Commerce, vol. 1 (4), (1997) pp. 49–88, M.E. Sharpe, Armonk, NY.Google Scholar
- 8.Sairamesh J., and Kephart, J., O. 1998. Price Dynamics of Vertically Differentiated Information Markets. In Proceedings of International Conference on Information and Computation Economies, Charleston, SC.Google Scholar
- 9.Wang, D., Market Maker: an Agent-Mediated Marketplace Infrastructure, MEng Thesis, (1999), Massachusetts Institute of Technology, Cambridge, MA.Google Scholar
- 10.Zacharia, G., Maes P. Trust management through reputation mechanisms, Applied Artificial Intelligence Journal, Vol. 14 (9), (October 2000), pp. 881–908, Taylor and Francis Ltd, London, UK; ISSN: 0883-9514Google Scholar