In ancient times, people exchanged their goods and services to obtain what they
needed (such as clothes and tools) from other people. This system of bartering compensated
for the lack of currency. People offered goods/services and received in kind
other goods/services. Now, despite the existence of multiple currencies and the
progress of humanity from the Stone Age to the Byte Age, people still barter but in a
different way. Mainly, people use money to pay for the goods they purchase and the
services they obtain.
Commerce
Notwithstanding the technologies that are involved, undertaking commerce can be associated
with one of the four types of exchange: bargaining, bidding, auctioning, and clearing. The first two types of exchange are bilateral and the last two types of exchange
are trilateral (that is, a third party intervenes).
• Bargaining involves one user that negotiates with a provider until an agreement
between both is reached. First, the user looks for a provider, browses their products,
and then negotiates with the provider for an agreement. If the negotiation fails, the user
continues searching for other providers until an agreement with one of them is
reached.
• Bidding involves one user and several providers. First, the user calls for bids.
Next, the user compares the offers that providers have submitted after receiving
the call for bids. Finally, the user selects the provider that has made the lowest
offer (that is, the offer that minimizes the user’s expense).
• Auctioning (English scenario) involves one provider, several potential users, and
one broker. First, the provider fixes the lowest price of the product. Through the
broker, the provider advertises their products and calls for auctions. Next, the different
users respond to the call for auctions by making offers to the broker. Acting
on the provider’s behalf, the broker selects the user who has made the highest
offer regarding the first offer of the provider (that is, the user’s offer maximizesthe provider’s income). Besides the English scenario of auctioning, Dutch and
Vickrey also exist as additional scenarios of auctioning.
• Clearing involves several users, several providers, and one broker. Users and
providers submit their respective requests to the broker in terms of needs to satisfy
for the users and services to offer for the providers. The role of the broker is
to match needs to services. If there is a successful match, the broker notifies both
users and providers about the match. As soon as they are informed, users and
providers start interacting together, bypassing the broker.
