Smart Agents Research Articles

Smart Agents: When Lower Search Costs for Quality Information Increase Price Sensitivity

Recent consumer research suggests that lowering search costs for quality information reduces consumer price sensitivity by creating greater perceived differentiation among brands (e.g., Kaul and Wittink 1995; Lynch and Ariely 2000). We argue that lowering quality search costs by smart agents can have the opposite effect on differentiation and price sensitivity. Smart agents screen through a universe of alternatives, recommending only a handful well-matched to the customer's quality preferences. In this research, we ask and answer the following questions: In markets in which price and quality are uncorrelated, will the use of screening agents increase or decrease prices paid compared to searching from an unordered list of options? Will increasing the size of the store's underlying assortment increase or decrease prices paid when options have been screened on quality? In markets where higher priced goods have higher quality, will the use of screening agents increase or decrease prices paid and quality selected? Experiments 1 and 2 test the effect of quality screening when price and quality are uncorrelated. We then present an analytic model for markets in which price and quality are correlated. We deduce that ordering can cause price and quality to increase or decrease depending on the slope of the price quality relationship in comparison with the relative importance of price in the utility function. We find support for this model in Experiment 3.

Reaction‐diffusion and ant‐based load balancing of communication networks

Attempts to characterise some aspects of the new wave of reaction‐diffusion and ant based computation, and to discuss their place in the class of fully distributed load‐balancing algorithms that solve the dynamic load‐balancing problem of communication networks. The main question of the paper states: what are the advantages of the intellectualisation of the control agents and what are the costs of smartness? We start our investigation with random walk techniques and the electricity paradigm, carry on with the reaction‐diffusion approach, and finish the construction of the computational hierarchy with the ant paradigm and smart agents.

Progress in optical imaging

Different optical imaging technologies have significantly progressed over the last years. Besides advances in imaging techniques and image reconstruction, new "smart" optical contrast agents have been developed which can be used to detect molecular targets (such as endogenous enzymes) in vivo. The combination of novel imaging technologies coupled with smart agents bears great diagnostic potential both clinically and experimentally. This overview outlines the basic principles of optical imaging and summarizes the current state of the art.

Herding and anti-herding: A model of reputational differentiation

We analyze a model related to the strategic herding literature where a second expert maximizes his expected second period value by conforming with a first expert (‘herding’). In contrast to the herding literature we assume that an agent is most valuable if he is the only smart agent. If the value of being the only smart agent is sufficiently large, the second expert always opposes its predecessor's report; otherwise, herding may result.

Cyberspace 2.0

This Essay reviews Lawrence Lessig, Code and Other Laws of Cyberspace, and Andrew Shapiro, The Control Revolution: How the Internet is Putting People in Charge and Changing the World We Know. Lessig and Shapiro each rebut the libertarian impulse of first generation cyberspace scholarship, but their books reveal some fundamental differences between them as well. After probing Lessig's and Shapiro's central themes, I examine three further issues that their analyses and the developing Internet raise: (1) digital technology's capacity to enable individuals to customize their information input, leading, some fear, to the Balkanization of public discourse; (2) the purported potential role of electronic smart agents in enhancing user power vis-a-vis sellers and commercial actors, and in thus recovering the libertarian vision of the Internet; and (3) the Internet's potential for building community and how that role might fit within a larger sphere of democratic politics and civil society.

New Search and Navigation Techniques in the Digital Library

Summary The introduction of technology into library information systems has provided new and enhanced search powers in the following areas: the speed of searching large individual and federated databases, keyword access, access to value-added metadata, customized interfaces (that relieve the burden of difficult techniques for sophisticated options), combinatorics for citation and semantic analysis, post-search relevancy analysis, release from the cost recovery scenario, and smart agent assistance. These advances save time, provide new research possibilities, and create new data relationships and research areas. However, there are still many areas in which improvements are needed: filters for handling information overload, cross-database searching standards, subject schema normalization, and balancing the need for subject-specific customization and cross-disciplinary standardization. Regardless of the technological advances, there will always be a need for critical thinking skills in order to perform an adequate research search.

Technology takes to securities trading

The Internet and other communications technologies are changing the way financial markets operate. Some markets will be full-service marketplaces, others will provide only certain services, and others will be ill-defined-such as smart agents on the Internet. Technology will allow orders to be routed to the most appropriate market. So the market of the future is likely to be a glass box of markets with different but transparent trading opportunities accessible through technology. The result will be seamless electronic trading, around the clock and around the world, with investors buying and selling individual stocks, currencies, commodities and mixed portfolios. Trades will be based on a variety of parameters. Liquidity will be provided primarily by investors, as opposed to intermediaries. Settlement will occur in real time. Multiple types of competing markets and market centers will provide multiple services. Transaction costs will fall to competitive levels on a worldwide basis. Technology will help us achieve this goal, but foresight and thoughtful proactive regulation are also necessary. Let us hope that, if the technical community keeps providing the former, the government will try hard to provide the latter.

One Smart Agent

This paper proposes an equilibrium concept for a class of games in which players make irreversible costly decisions; these games have been widely used in the recent I.O. literature. The equilibrium concept is defined, not in the space of strategies, but in the space of (observable outcomes). It is weaker than perfect Nash equilibrium, and involves combining a form of ?survivor principle? with an assumption regarding entry. This assumption involves only a very weak rationality requirement: if a profitable opportunity exists in the market, there is ?One smart agent ? who will find it. This weak equilibrium concept is sufficient to imply some empirically interesting regularities in the area of market structure.