A Negotiator's Backup Plan: Optimal Concessions with a Reservation Value

• URL: http://arxiv.org/abs/2404.19361v1
• Date: Tue, 30 Apr 2024 08:45:18 GMT
• Title: A Negotiator's Backup Plan: Optimal Concessions with a Reservation Value
• Authors: Tamara C. P. Florijn, Pinar Yolum, Tim Baarslag,
• Abstract summary: This paper develops an optimal bidding strategy called MIA-RVelous for bilateral negotiations with private reservation values. The proposed greedy algorithm finds the optimal bid sequence given the agent's beliefs about the opponent in $O(n2D)$ time.
• Score: 3.3058382994863984
• License: http://creativecommons.org/licenses/by/4.0/
• Abstract: Automated negotiation is a well-known mechanism for autonomous agents to reach agreements. To realize beneficial agreements quickly, it is key to employ a good bidding strategy. When a negotiating agent has a good back-up plan, i.e., a high reservation value, failing to reach an agreement is not necessarily disadvantageous. Thus, the agent can adopt a risk-seeking strategy, aiming for outcomes with a higher utilities. Accordingly, this paper develops an optimal bidding strategy called MIA-RVelous for bilateral negotiations with private reservation values. The proposed greedy algorithm finds the optimal bid sequence given the agent's beliefs about the opponent in $O(n^2D)$ time, with $D$ the maximum number of rounds and $n$ the number of outcomes. The results obtained here can pave the way to realizing effective concurrent negotiations, given that concurrent negotiations can serve as a (probabilistic) backup plan.

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