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Alternating-offers Bargaining problems A Co-evolutionary Approach. A Generation 0. B -Generation 0. A Generation 1. B -Generation 1. A Generation 2. B -Generation 2. A Generation n. B -Generation n. Edward Tsang Computational Finance & Economics. Maria Fasli TAC Auction.
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A Co-evolutionary Approach
B -Generation 0
A Generation 1
B -Generation 1
B -Generation 2
Finance & Economics
Nanlin Jin, Professor Edward Tsang, Professor Abhinay Muthoo, Tim Gosling, Dr Maria Fasli, Dr Sheri Markose, Guannan Wang
Basic Alternating-Offers Bargaining Problem
Bargaining theory studies a class of bargaining situations where two players have common interests, usually called “cake”, but conflict over how the cake is divided.
Under the “No delay” and “Stationarity” assumptions, Perfect Equilibrium Partition (P.E.P) of the basic Alternating-Offer Bargaining is:
More Realistic Assumptions
For the bargaining problem, co-evolution is required as (a) the fitness is assessed by bargaining outcomes between strategies from co-evolving populations; and (b) the two players may have different information.
Cake Partitions by Co-Evolution:
In general, co-evolutionary system can find out approximate solutions with low cost and reasonable time. Experimental agreements distribute within the P.E.P neighbourhood.
Run time:100 runs last for only about 1 or 2 days
In Biology,co-evolution is defined as reciprocal evolutionary change in interacting species.
Where X*A and X*B are the optimal share for A and B, respectively, A and B are their discount factors
Evolution Computation, inspired by nature, has been proved successful in studying adaptive systems. It is especially good for non-linear, epistatic, large search- space problems.
For more information, visit:
Computational Finance: http://cswww.essex.ac.uk/Research/CSP/finance
Center for Computation Finance and Economic Agents: (CCFEA) http://www.cfea-labs.net
For possible collaboration, contact:
Professor Edward Tsang
Phone: +44 1206 872774; email: [email protected] Jin
Phone: +44 1206 872771; email: [email protected]
This research has been partly funded by BT and University of Essex
In situations when we are unable to compute the P.E.P., can we evolve sensible bargaining strategies?