Businesses with unionized employees have to negotiate contracts frequently. Their need is to remain profitable without hurting the employees in the process. Good business leaders have to walk the fine line between giving away too many concessions that hurt the companies profitability and not giving enough concessions so that the employees have to strike or otherwise display their power.
An agent starts with a contract that’s optimal for that agent and makes concessions, in each subsequent
proposal, until either an agreement is reached or the negotiation is abandoned because the latest proposal’s utility has fallen below the agents’ reservation value—that is, the minimum level of contract utility that the agent will accept. (Klein, 2003)