This is one of the reasons for the last minute change prior to the game going gold.
An example. A unit in the city square being peppered by archers and refusing to go out and meet them.
Well it's alot easier for them to stay in the city square rather than going OUT and meet them on the open field or in this case take the bait.
This is why I use time limits, so the battles don't go too long and forces the AI to make a move.
Though I still feel that it's way too passive in some cases.
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