Preferences among defaults play a crucial role in nonmonotonic reasoning. One source of preferences that has been studied intensively is specificity [15,22,23]. In case of a conflict between defaults we tend to prefer the more specific one since this default provides more reliable information. E.g., if we know that students are adults, adults are normally employed, students are normally not employed, we want to conclude ``Peter is not employed'' from the information that Peter is a student, thus preferring the student default over the conflicting adult default.
Specificity is an important source of preferences, but not the only one, and at least in some applications not necessarily the most important one. In the legal domain it may, for instance, be the case that a more general rule is preferred since it represents federal law as opposed to state law . In these cases preferences may be based on some basic principles regulating how conflicts among rules are to be resolved.
Also in other application domains, like model based diagnosis or configuration, preferences play a fundamental role. Model based diagnosis uses logical descriptions of the normal behaviour of components of a device together with a logical description of the actually observed behaviour. One tries to assume normal behaviour for as many components as possible. A diagnosis corresponds to a set of components for which these normalcy assumptions lead to inconsistency. Very often a large number of possible diagnoses is obtained. In real life some components are less reliable than others. To eliminate less plausible diagnoses one can give the normalcy assumptions for reliable components higher priority.
In configuration tasks it is often impossible to achieve all of the design goals. Often one can distinguish more important goals from less important ones. To construct the best possible configurations goals then have to be represented as defaults with different preferences according to their desirability.
The relevance of preferences is well-recognized in nonmonotonic reasoning, and prioritized versions for most of the nonmonotonic logics have been proposed, e.g., prioritized circumscription , hierarchic autoepistemic logic , prioritized default logic . In these approaches preferences are handled in an ``external'' manner in the following sense: some ordering among defaults is used to control the generation of the nonmonotonic conclusions. For instance, in the case of prioritized default logic this information is used to control the generation of extensions. However, the preference information itself is not expressed in the logical language. This means that this kind of information has to be fully pre-specified, there is no way of reasoning about (as opposed to reasoning with) preferences. This is in stark contrast to the way people reason and argue with each other. In legal argumentation, for instance, preferences are context-dependent, and the assessment of the preferences among involved conflicting laws is a crucial (if not the most crucial) part of the reasoning.
What we would like to have, therefore, is an approach that allows us to represent preference information in the language and derive such information dynamically. In a recent paper  the author has described a variant of normal default logic in which reasoning about preferences is possible. Although the version of default logic presented in this earlier paper produces reasonable results in most cases, this approach has several drawbacks:
The outline of the rest of the paper is as follows: in Section 2 we first review a definition of well-founded semantics for logic programs with two types of negation which is based on the double application of a certain anti-monotone operator. The definition extends Baral and Subrahmanian's formulation of well-founded semantics for normal logic programs  and was used by several authors [1,13]. We show that this definition suffers from an unnecessary weakness and present a reformulation that leads to better results. Section 3, the main section of the paper, introduces our dynamic treatment of preferences together with several small motivating examples. We show that our conclusions are, in general, a superset of the well-founded conclusions. Section 4 illustrates the expressive power of our approach using a more realistic example from legal reasoning. Section 5 shows that the worst case time complexity for generating well-founded conclusions for prioritized programs is polynomial. Section 6 investigates the relationship to Gelfond and Lifschitz's answer set semantics . Section 7 discusses related work and concludes.