Negotiation is a conflict management technique that involves constant interaction between agents in order to come to a mutual agreement on attributes of a shared resource. For example, product selling agents and buying agents will negotiate to come to a reasonable price such that the buyer can afford it and the seller can earn a reasonable amount of profit.

Although the negotiation technique for conflict resolution is broad, there are a set of specific components that are standardized in each and every negotiation setting.

• A negotiating set is required in order to list the possible space for proposals that an agent can make.
• A protocol is a set of rules, which all agents abide by whilst making proposals of negotiation.
• A collection of strategies is required in order to determine what proposals an agent is to make.
• A rule determines when negotiation needs to be terminated when a deal is struck.

The above gives a general overview as to what happens when agents within the Multi-Agent System negotiate.

Negotiation will take place as a series of rounds where each agent will make a proposal at every round. The proposals that are made are selected from the negotiation set. They are verified for illegibility via the negotiation protocol that all agents within the system need to adhere to. After several rounds of proposals, an agreement will be reached. The agreement will be determined by the agreement rule that is part of the negotiation component. At this point a deal will be struck and negotiation will be terminated.

A worldly application of negotiation is in the trading scenario (a buying and selling Multi-Agent System), outlined below.

When humans buy and sell, there is usually a negotiation between the buyer and the seller in order to improve trade. The seller will work towards selling it for a higher price to earn a higher profit, whereas the buyer will look for a cheaper purchase. By placing this into a multi-agent system, there will be 2 types of agents; the buyer, and the seller.

• There will be series of rounds where the buyer and the seller will make proposals on the various prices that could be charged for the product being bought.
• The buyer and seller will both be aware that there is only a certain margin that could be negotiated over; this will form the possibilities within the negotiation set.
• After several rounds, the buyer and the seller agents will come to a mutual agreement. At this point a deal will be struck and negotiation will be terminated by the seller selling the product to the buyer.

The environment in which negotiation takes place can be made richer and more complex by an in-depth analysis of the type of issues that agents negotiate over. This leads to two major types:

• Single Issue Negotiation
  
  This type of negotiation takes place where agents negotiate over one common issue. For e.g. in the above buying and selling multi-agent system, the buyer and seller can negotiate over the price. This is also known as symmetric negotiation.


• Multiple Issue Negotiation
  
  This type of negotiation takes place where there are multiple attributes of conflict in a single environment. For e.g. the buyer and seller can negotiate over the quantity, quality and the price of the product that is sold.

Moreover negotiation is also classified in a hierarchal manner, resulting from various levels of interaction.

• One-to-One negotiation
  This type of negotiation takes place where there is one agent negotiating with just one other agent at one point of time. For e.g. one seller negotiating with one buyer.


• Many-to-One negotiation
  This type of negotiation takes place where there are several agents negotiating with just one other agent at some point in time.


• Many-to-Many negotiation
  In this setting many agents negotiate with many other agents simultaneously. However this makes the process of negotiation complex and hard to handle, making it one of the least preferred types of negotiation.

Thus, we can conclude that negotiation is a very powerful technique for conflict resolution. However, consideration should be given to the fact that there are various other techniques that could be put into practice. To exemplify this, a general conflict handling model that can be applied to any technique that is adopted has been outlined (see Agents' Conflict Handling Action Model).