Quantitative Concession Behavior Analysis and Prediction for Decision Support in Electronic Negotiations

Quantitative analysis of negotiation concession behavior is performed based on empirical data with the purpose of providing simple and intuitive decision support in electronic negotiations. Previous work on non-linear concave preferences and subsequent concession crossover provides a theoretical basis for the model. The authors propose a model which quantifies the remaining concession potential for each issue and a generalization of the model which permits the memory/decay of past concessions. These models permit the analysis of negotiators' concession behavior. Using the proposed models, it was possible to quantitatively determine that negotiators in the authors' negotiation case exhibit concession crossover issues and thus have a tendency to give concessions on issues with the most remaining concession potential. This finding provides empirical evidence of concession crossover in actual concessions and the corresponding model permits the design of a simple and intuitive prediction methodology, which could be used in real world negotiations by decision support systems or automated negotiation agents.