Economic Implications of Agent Technology and E-Commerce

Following the exponential growth of the Internet and World Wide Web, electronic commerce already accounts for some $1.5 billion a year. But the scope and volume of e-commerce is likely to increase further sharply because of advances in agent technology, i.e. applications where users delegate the authority to search and filter information, schedule meeting or negotiate agreements, to software agents, programs that acts independently on their behalf. This paper describes in some detail existing agents and multi-agents applications in the context of ecommerce, and suggests a research agenda for economists in response to these changes in technology and lifestyle. First, several ways where economic theory (and in particular implementation theory) can be used to design and improve the efficiency of e-commerce systems are described. Second, the paper discusses the impact on markets of using software agents. Finally, the paper discusses how economic theory can be used towards the design of the interactions between agents and their users.