Designing Electronic Markets for Defeasible-based Contractual Agents

TL;DR

This paper introduces DEMCA, a simulation environment for electronic markets where agents use defeasible logic to decide on contractual remedies based on legal principles, aiming to maximize welfare.

Contribution

It presents a novel simulation framework integrating legal-inspired remedies with defeasible logic for contractual agents in electronic markets.

Findings

DEMCA effectively models contractual remedy selection

Agents using the framework improve market welfare

Legal principles guide agent decision-making in simulations

Abstract

The design of punishment policies applied to specific domains linking agents actions to material penalties is an open research issue. The proposed framework applies principles of contract law to set penalties: expectation damages, opportunity cost, reliance damages, and party design remedies. In order to decide which remedy provides maximum welfare within an electronic market, a simulation environment called DEMCA (Designing Electronic Markets for Contractual Agents) was developed. Knowledge representation and the reasoning capabilities of the agents are based on an extended version of temporal defeasible logic.