Equilibria in Automated Interactions

Automated agents are increasingly being used to interact on behalf of individuals and organizations in electronic markets. Agents are used, for example, to explore the set of possible contracts and to trade in communication bandwidth. Users choose agents which are then matched on various locations (hosts). Hosts will normally check the agents (i.e., the code) to verify that it is compatible with the communication protocol. In this paper we explore the equilibrium outcomes of such interactions. We show that users will choose agents who reveal parts of their code in order to coordinate on welfare improving outcomes which otherwise would not have been supported in equilibrium.