Artificial Life VI


Price-War Dynamics in a Free-Market Economy of Software Agents

Jeffrey O. Kephart
IBM Thomas J. Watson Research Center

James E. Hanson
IBM Thomas J. Watson Research Center

Jakka Sairamesh
IBM Thomas J. Watson Research Center


Abstract

We envisage the evolution of the Internet into a free-market information economy in which billions of software agents exchange a rich variety of information goods and services with humans and amongst themselves. This will inevitably occur as agents assume an ever more pervasive and responsible role in electronic commerce. Even more fundamentally, the proven ability of the free-market economy to adjudicate and satisfy the conflicting needs of billions of human agents suggests it as a decentralized organizational principle for billions of software agents as well. However, given that software agents can make decisions several orders of magnitude faster than humans, and are vastly less flexible and complex, it is quite conceivable that an agent economy would behave in ways that are entirely alien to us. It is thus legitimate to ask: Is a free-market information economy inherently capable of facilitating the interactions of billions of software agents, and if so what are the minimal requirements on the infrastructure of such an economy and on the agents that populate it?


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