Annals of Mathematics and Artificial Intelligence 9(1993)361-386 361 The case of the lying postman: Decoys and deception in negotiation Gilad Zlotkin and Jeffrey S. Rosenschein Computer Science Department, Hebrew University, Givat Ram, Jerusalem, Israel Abstract Much research in negotiation assumes complete knowledge among the interacting agents and/or truthful agents. These assumptions in many domains will not be realistic, and this paper extends our previous work in dealing with the case of inter-agent negotiation with incomplete information. A discussion of our existing negotiation framework sets out the rules by which agents operate during this phase of their interaction. The concept of a "solution" within this framework is presented; the same solution concept serves for interactionsbetween agents with incomplete informationas it does for complete information interactions. The possibility of incomplete information among agents opens up the possibility of deception as part of the negotiation strategy of an agent. Deception during negotiation among autonomous agents is thus analyzed in the Postmen Domain, which was introduced by us in a previous paper. New results regarding the non-beneficial nature of lies is presented. It is shown that hiding letters can be beneficial when negotiation is conducted over mixed deals. When the Postmen Domain is restricted to graphs having a tree topology, then it is shown that decoy letters (manufactured by a lying agent) can never be beneficial, and that no combination of types of lies is beneficial when negotiation is conducted over all-or-nothing deals. 1. Introduction Negotiation has been the focus of much research in recent years within the distributed artificial intelligence (DAI) community. Approaches to studying negotiation have ranged from emulation of human negotiation strategies [16,17,6,7] to the consideration of how loosely coupled agents can resolve problems of resource and task allocation [3,15, 11,9]. The problem of coordination, both within a single system and between truly autonomous agents, has also occupied many researchers [13, 2, 8]. Much of this research in negotiation assumes complete knowledge among the interacting agents and/or truthful agents. These assumptions in many domains are not realistic, and this paper extends previous work [19,22,21] in dealing with the case of inter-agent negotiation with incomplete information. 9 J.C. Baltzer AG, Science Publishers