Negotiation Processes, Electronic Negotiation Media and Electronic Transactions

1. Introduction The new economy is the largest and most complex adaptive system ever created (Lycos 2000). It is electronically mediated, that is, people and organizations use software tools on the Internet to commun icate, interact, collaborate, make decisions, enter transactions and manage. The new economy employs solutions of the old economy, such as local markets, face-to-face negotiations, physical distribution channels and logistics. It also introduces new or modifies existing solutions, including e-markets, on-line auctions, electronic bargaining tables, mass customi-zation, and virtual enterprises. Models and procedures used to devise and implement these solutions are embedded in software. Four observations about the role of information technology in the new economy underlie this proposal: (1) software and computer-based communication media are the platform through which all transactions and activities are conducted, (2) software allows for implementation and enhancements of existing mechanisms and solutions, (3) certain new mechanisms would not be possible without software, and (4) soft ware is used to support decision-making and negotiations. Hardware and traditional communication facilities are mostly passive. Software tools and soft ware-enhanced communication, on the other hand, can actively and autonomously seek, retrieve, store, transform, aggregate and integrate information. Furthermore, soft ware programs are increasingly used to make decisions on behalf of individuals and organizations (e.g., bidding and restocking). Processes involving two or more individuals and organizations are key to many activities both in the traditional and new economy. The new economy gives new motivation to research on negotiation protocols, auction and bidding mechanisms, tools for bargaining, and negotiating and auctioning software agents. Go vernments and other organizations are interested in using electronic marketplaces and systems to co nduct their transactions, support decision-making and resolve conflicts. This has increased the researchers' interest in theoret ical and applied projects. Negotiations are the centrepiece of the proposed research program. It will investigate their role in e-business, and study their effect on e-business activities and on activities emerging in participatory go vern