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Agent Technology for E-Commerce

ISBN: 978-0-470-72597-9
480 pages
July 2011, ©2007
Agent Technology for E-Commerce (0470725974) cover image

Description

Agents are software systems that are capable of autonomous, reactive, and proactive behavior, and endowed with the ability to interact with other agents. Agents are especially well-suited for intricate, fast-changing, and constrained environments such as the electronic marketplace. Agent Technology for E-Commerce is a unique introduction to the theory behind and applications of agent technology in e-commerce. It provides a clear introduction to agents, architectures, and multi-agent systems as well as agent interactions, while helping readers versed in computer science comprehend basic principles of economics and game theory. The book also covers the issue of trust and security in agent technology, particularly in the context of electronic markets.
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Table of Contents

List of Figures xv

List of Tables xvii

Preface xix

CHAPTER 1 – Introduction 1

1.1 A paradigm shift 3

1.1.1 A brief history 5

1.1.2 The novelty in agents 8

1.1.3 Agent applications 9

1.2 Electronic commerce 10

1.2.1 E-commerce and organizations 12

1.2.2 E-commerce and the individual 14

1.3 Agents and e-commerce 16

1.4 Further reading 18

1.5 Exercises and topics for discussion 19

CHAPTER 2 – Software Agents 21

2.1 Characteristics of agents 22

2.2 Agents as intentional systems 25

2.3 Making decisions 26

2.3.1 Environments 26

2.3.2 Performance measure and rationality 30

2.3.3 Rational decision-making and optimal policies 32

2.3.4 Optimal policies in MDPs 34

2.4 Planning 37

2.5 Learning 38

2.6 Agent architectures 41

2.6.1 Logic-based architecture 41

2.6.2 Reactive architecture 45

2.6.3 Belief-Desire-Intention architecture 49

2.6.4 Hybrid architecture 54

2.7 Agents in perspective 57

2.7.1 Agents and objects 58

2.7.2 Agents and expert systems 59

2.7.3 Agents, Web Services and the Semantic Web 60

2.8 Methodologies and languages 62

2.8.1 Methodologies 62

2.8.2 Agent-oriented methodologies 62

2.8.3 Object-oriented based methodologies 66

2.8.4 Knowledge-engineering based and other methodologies 67

2.8.5 Programming languages and environments 67

2.8.6 From legacy systems to agents 69

2.9 Further reading 71

2.10 Exercises and topics for discussion 72

CHAPTER 3 – Multi-agent Systems 75

3.1 Characteristics of multi-agent systems 76

3.1.1 Potential and challenges 77

3.1.2 Closed multi-agent systems 79

3.1.3 Open multi-agent systems 79

3.2 Interaction 80

3.2.1 Elements of interactions 80

3.2.2 Modes of interaction 81

3.2.3 Interaction protocols 83

3.3 Agent communication 84

3.3.1 Speech Act theory 85

3.3.2 Agent communication languages 85

3.3.3 Knowledge and Query Manipulation Language (KQML) 86

3.3.4 FIPA ACL 90

3.3.5 Comparing KQML and FIPA ACL 93

3.3.6 Knowledge Interchange Format Language (KIF) 93

3.3.7 Dialogues 94

3.3.8 A layered model of communication 95

3.4 Ontologies 97

3.4.1 Explicit ontologies 98

3.4.2 Developing ontologies 99

3.4.3 OWL 100

3.5 Cooperative problem-solving 103

3.5.1 Task decomposition and distribution 104

3.5.2 The ContractNet Protocol 104

3.6 Virtual organizations as multi-agent systems 107

3.7 Infrastructure requirements for open multi-agent systems 108

3.8 Further reading 111

3.9 Exercises and topics for discussion 111

CHAPTER 4 – Shopping Agents 115

4.1 Consumer buying behaviour model 116

4.2 Comparison shopping 117

4.3 Working for the user 119

4.4 How shopping agents work 120

4.5 Limitations and issues 122

4.6 Further reading 125

4.7 Exercises and topics for discussion 125

CHAPTER 5 – Middle Agents 127

5.1 Matching 128

5.1.1 Middle agent architecture 129

5.1.2 Interacting through a middle agent 130

5.2 Classification of middle agents 131

5.2.1 Matchmaker 132

5.2.2 Broker 134

5.2.3 Broadcaster 135

5.2.4 FIPA Directory Facilitator 136

5.3 Describing capabilities 136

5.4 LARKS 137

5.4.1 Matching in LARKS 139

5.4.2 Matching methods 140

5.5 OWL-S 144

5.6 Further reading 147

5.7 Exercises and topics for discussion 147

CHAPTER 6 – Recommender Systems 149

6.1 Information needed 151

6.2 Providing recommendations 152

6.3 Recommendation technologies 153

6.4 Content-based filtering 153

6.5 Collaborative filtering 155

6.5.1 How collaborative filtering systems work 155

6.5.2 Neighbourhood-based algorithms 156

6.5.3 Problems in collaborative filtering 158

6.5.4 Collaborative filtering systems 159

6.6 Combining content and collaborative filtering 161

6.7 Recommender systems in e-commerce 162

6.8 A note on personalization 163

6.9 Further reading 165

6.10 Exercises and topics for discussion 165

CHAPTER 7 – Elements of Strategic Interaction 167

7.1 Elements of Economics 168

7.1.1 A simple market economy 168

7.1.2 Consumption bundles and preferences 173

7.1.3 Utilities 177

7.1.4 Equilibrium 178

7.2 Elements of Game Theory 180

7.2.1 Strategic games 181

7.2.2 Extensive form representation 183

7.2.3 Information 184

7.2.4 Categories of games 185

7.2.5 Solution concepts 185

7.2.6 Mixed strategies 188

7.2.7 The prisoner’s dilemma 191

7.2.8 Repeated games 193

7.2.9 Dynamic games 194

7.2.10 Bayesian Nash games 196

7.2.11 Beliefs and sequential rationality 200

7.3 Further reading 203

7.4 Exercises and topics for discussion 204

CHAPTER 8 – Negotiation I 209

8.1 Negotiation protocols 211

8.2 Desired properties of negotiation protocols 212

8.3 Abstract architecture for negotiating agents 213

8.4 Auctions 215

8.5 Classification of auctions 217

8.6 Basic auction formats 220

8.6.1 English auction 220

8.6.2 Dutch auction 221

8.6.3 First-price sealed-bid auction 222

8.6.4 Vickrey auction 222

8.6.5 Allocation and revenue comparisons 223

8.6.6 Disadvantages of auctions 225

8.7 Double auctions 228

8.7.1 Mth and (M+ 1)st price rules 229

8.7.2 Implementation of the Mth and (M+ 1)st price rules 231

8.8 Multi-attribute auctions 234

8.9 Combinatorial auctions 236

8.10 Auction platforms 239

8.10.1 AuctionBot 239

8.10.2 e-Game 240

8.10.3 Trading agent competition 242

8.10.4 Online auctions 243

8.11 Issues in practical auction design 244

8.12 Further reading 247

8.13 Exercises and topics for discussion 248

CHAPTER 9 – Negotiation II 251

9.1 Bargaining 252

9.1.1 Bargaining power 253

9.1.2 Axiomatic bargaining 255

9.1.3 Strategic bargaining 256

9.1.4 The Strategic Negotiation Protocol 258

9.2 Negotiation in different domains 260

9.2.1 Task-oriented domains 260

9.2.2 Worth-oriented domains 266

9.3 Coalitions 267

9.3.1 Coalition formation 267

9.3.2 Coalition structure generation 268

9.3.3 Division of payoffs 271

9.4 Applications of coalition formation 272

9.4.1 Customer coalitions 273

9.4.2 Coalition Protocols 275

9.4.3 Post-negotiation protocol 277

9.4.4 Pre-negotiation protocol 278

9.4.5 Distribution of costs and utility 279

9.4.6 Other applications 280

9.5 Social choice problems 280

9.5.1 Making a social choice 281

9.5.2 Voting protocols 282

9.5.3 Maximizing social welfare 286

9.6 Argumentation 287

9.6.1 Generating arguments 289

9.6.2 The PERSUADER system 291

9.6.3 Logic-based argumentation 293

9.6.4 Negotiation as dialogue games 295

9.7 Further reading 299

9.8 Exercises and topics for discussion 300

CHAPTER 10 – Mechanism Design 305

10.1 The mechanism design problem 306

10.2 Dominant strategy implementation 308

10.3 The Gibbard–Satterthwaite Impossibility Theorem 311

10.4 The Groves–Clarke mechanisms 312

10.4.1 Quasilinear environments 312

10.4.2 The Groves mechanism 313

10.4.3 The Clarke mechanism 314

10.4.4 The Generalized Vickrey Auction 315

10.4.5 Inducing truth-telling in voting mechanisms 318

10.5 Mechanism design and computational issues 319

10.6 Further reading 322

10.7 Exercises and topics for discussion 322

CHAPTER 11 – Mobile Agents 325

11.1 Introducing mobility 326

11.2 Facilitating mobility 328

11.2.1 Migration 329

11.2.2 Modes of migration 330

11.3 Mobile agent systems 331

11.3.1 Non-Java mobile agent systems 332

11.3.2 Java-based mobile agent systems 333

11.4 Aglets 335

11.4.1 Programming model 336

11.4.2 Communication 337

11.4.3 Security 338

11.5 Mobile agent security 339

11.5.1 Threats 340

11.5.2 Security services 343

11.5.3 Protecting the host 344

11.5.4 Protecting the mobile agent 345

11.5.5 Dealing with the perpetrators 347

11.6 Issues on mobile agents 348

11.7 Further reading 350

11.8 Exercises and topics for discussion 350

CHAPTER 12 – Trust, Security and Legal Issues 351

12.1 Perceived risks 353

12.2 Trust 355

12.3 Trust in e-commerce 356

12.3.1 Trust in agent technology 357

12.3.2 Trust in the marketplace 359

12.4 Electronic institutions 360

12.4.1 Norms, institutions and organizations 361

12.4.2 From norms to institutions 362

12.4.3 Formalizing norms 364

12.4.4 Agents in electronic institutions 365

12.5 Reputation systems 366

12.5.1 Reputation systems in practice 367

12.5.2 Issues and problems 369

12.6 Security 370

12.7 Cryptography 373

12.7.1 Symmetric cryptosystems 374

12.7.2 Asymmetric cryptosystems 375

12.7.3 Applications of public key cryptography 376

12.7.4 Digital signatures 378

12.7.5 Digital certificates 380

12.8 Privacy, anonymity and agents 381

12.8.1 Agents and privacy 381

12.8.2 Anonymity 383

12.8.3 Protecting privacy 384

12.9 Agents and the law 386

12.10 Agents as legal persons 389

12.11 Closing remarks 391

12.12 Further reading 392

12.13 Exercises and topics for discussion 394

APPENDIX A – Introduction to Decision Theory 395

A.1 Probability theory 396

A.1.1 Prior probability 397

A.1.2 Conditional probability 397

A.1.3 Independence 398

A.1.4 Bayes’ rule 398

A.2 Making decisions 399

A.2.1 Non-probabilistic decision-making under uncertainty 401

A.2.2 Probabilistic decision-making under uncertainty 403

A.3 Utilities 403

A.3.1 Preferences 404

A.3.2 Utility functions 405

A.3.3 Utility and money 407

A.3.4 Multi-attribute utility functions 411

A.4 Further reading 411

Bibliography 413

Index 445

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Author Information

Maria Fasli has taught a course on Agent Technology in E-commerce since 2000 as part of the MSc. in E-commerce Technology degree offered at the Department of Computer Science of the University of Essex. At the time of curriculum design, this was the first such specialized course designed in the UK. This course is now being offered as an option to other degree schemes in the Computer Science Department including the Doctoral program of the Centre of Computational Finance and Economic Agents (CCFEA).
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The Wiley Advantage

  • A unique introduction into the theory behind, and the applications of, agent technology in e-commerce; incorporating basic elements of economics and game theory.
  • It provides an introduction to agents, architectures and multi-agent systems as well as agent interactions including communication and cooperation.
  • Helps computer science students to comprehend some basic principles in economics and game theory.
  • In depth coverage of negotiation, including general principles, auctions, voting protocols, coalition formation and bargaining.
  • Coverage of middle agents and recommender technologies as well as the technology of mobile agents and how they can be deployed in e-commerce, and of trust and security in the area of agents and in particular in the context of electronic markets.
  • Provides a bridge between two disciplines and shows how Economics and Multi-agent systems can come together.
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