Electronic negotiation

Electronic negotiation represents an important and desirable coordination mechanism for electronic markets. Negotiation between agents allows cooperative and competitive sharing of information to determine a proper price.Recent research and practice has also shown that electronic negotiation is beneficial for the coordination of complex interactions among organizations. Electronic negotiation has recently emerged as a very dynamic, interdisciplinary research area covering aspects from disciplines such as Economics, Information Systems, Computer Science, Communication Theory, Sociology and Psychology.

Negotiation Types

The most common paradigm is the electronic auction type. As of 2005, most e-business negotiation systems can only support price negotiations. Traditional negotiations typically include discussion of other attributes of a deal, such as delivery terms or payment conditions. This one-dimensional approach is one of the reasons why electronic markets struggle for acceptance. Multiattributive and combinatorial auction mechanisms are emerging to allow further types of negotiation.

Support for complex multi-attribute negotiations is a critical success factor for the next generation of electronic markets and, more generally, for all types of electronic exchanges. This is what the second type of Electronic negotiation, namely Negotiation Support, addresses. While auctions are essentially mechanisms, bargaining is often the only choice in complex cases or those cases where no choice of partners is given. Bargaining is a hard, error-prone, ambiguous task often performed under time pressure. Information technology has some potential to facilitate negotiation processes which is analyzed in research projects/prototypes such as INSPIRE, Negoisst or WebNS.

The third type of negotiation is automated argumentation, where agents exchange not only values, but also arguments for their offers/counter-offers. This requires agents to be able to reason about the mental states of other market participants.

Technologies

One research area that has paid particular attention to modeling automated negotiations is that of autonomous agents. If negotiations occur frequently, possibly on a minute per minute basis in order to schedule network capacity, or negotiation topics can be clearly defined it may be desirable to automate this coordination effort.

Automated negotiation is a key form of interaction in complex systems composed of autonomous agents. Negotiation is a process of making offers and counteroffers, with the aim of finding an acceptable agreement. During negotiation, each offer is based on its own utility and expection of what other agent do. This means that a multi criteria decision making is need to be taken for each offer.