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Conclusion

 

Game-theoretic analysis of a model of a simple commodity market established a quantitative relationship between the degree of shopbot usage among buyers and the degree of price competition among sellers. This motivated a comparative study of various pricebot algorithms that sellers might employ in an effort to gain an edge in a market in which shopbots have increased the level of competition. Pricebots were shown to be capable of inducing price wars, yet even so they may earn profits that are well above game-theoretic equilibrium levels. Future work will explore the dynamics of markets in which more sophisticated shopbots base their search on product attributes as well as price, and in which pricebots use more sophisticated learning algorithms such as Q-learning.



kephart
Wed Apr 28 00:46:43 EDT 1999