Abstract:
An approach to auctions and bidding is founded on observations
and expectations of the opponents' behavior and
not on assumptions concerning the opponents' motivations
or internal reasoning. The approach draws ideas from information
theory. A bidding agent employs maximum entropy
inference to determine its actions on the basis of this
uncertain data. Maximum entropy inference may be applied
both to multi-issue and to single-issue negotiation.
Multi-issue variants of the four common auction mechanisms
are discussed.
