Four types of agents

We have designed four types of agents. Our first type of agent, the competitive , does not attempt to model the other agents. Thus, it is a 0-level non-estimating agent, as described in Section 4.2. The competitive agent always chooses its reservation price $\bar{P}_{b}$ and $\bar{P}_{s}$. Since the trading price is the average of the buyer's and seller's bids, it is always at least $\bar{P}_{s}$ (when the competitive agent sells), or at most $\bar{P}_{b}$ (when the competitive agent buys).

The other three types of agents choose their bidding prices (P_b,P_s) based on their predictions of other agents. Although they differ in how they estimate other agents' actions, they are identical in acting according to their best response to this estimate.