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Adaptive trust and co-operation : An agent-based simulation approach

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Author: Nooteboom, B. · Klos, T. · Jorna, R.
Type:article
Date:2001
Publisher: Springer Verlag
Institution: Technisch Physische Dienst TNO - TH
Source:Tan, Y.H.Falcone, R.Singh, M., Workshop on Deception, Fraud and Trust in Agent Societies, 2000 held as part of the Autonomous Agents Conference, 2000, 4 June 2000 through 4 June 2000, 2246, 83-109
series:
Lecture Notes in Artificial Intelligence (Subseries of Lecture Notes in Computer Science)
Identifier: 530869
ISBN: 3540430695 · 9783540430698
Keywords: Agentbased computational economics · Artificial adaptive agents · Complex adaptive systems · Governance · Inter-firm relations · Matching · Transaction costs · Trust

Abstract

Inter-firm relations have increasingly been analyzed by means of transaction cost economics (TCE). However, as has been widely acknowledged, TCE does not include dynamics of learning, adaptation or innovation, and it does not include trust. It assumes that efficient outcomes arise, while that may be in doubt, due to complexity and path-dependency of interactions between multiple agents that make, continue and break relations in unpredictable ways. We use the methodology of Agent-Based Computational Economics (ACE) to model how co-operation, trust and loyalty emerge and shift adaptively as relations evolve in a context of multiple, interacting agents. Agents adapt their trust on the basis of perceived loyalty. They adapt the weight they attach to trust relative to potential profit and they adapt their own loyalty, both as a function of realized profits. This allows us to explore when trust and loyalty increase and when they decrease, and what the effects are on (cumulative) profit. © Springer-Verlag Berlin Heidelberg 2001.