According to decades of research, whether negotiations succeed depends on how much of the stake each person will get. Yet, real-world stakes often consist of resources that vary on quality, not just quantity. While it may appear obvious that people should reject qualitatively inferior offers, just as they reject quantitatively unequal offers, it is less clear why. Across three incentive-compatible studies (N = 1,303) using the ultimatum game, we evaluate three possible reasons for why people reject qualitatively unequal negotiation offers (that are 50% of the stake): fairness, mere inequality, or badness. Data across the three studies are consistent with the fairness account. Casting doubt on the possibility that people reject qualitatively unequal offers merely because they are ‘bad’, Studies 1 and 2 found that participants were more likely to reject the same coins when these were inferior (e.g., 200 × 5¢ coins) to the negotiation partner’s coins (e.g., 5 × $2 coins) than when both parties received the same undesirable coins (e.g., both received 200 × 5¢ coins). Supporting a fairness explanation, rejection rates of the qualitatively inferior offer were higher when the proposal came from a human (vs. a computer), suggesting that rejection stemmed in part from a desire to punish the negotiation partner for unfair treatment (Study 3). Nevertheless, some participants still rejected the unequal offer from a computer, suggesting that mere inequality matters as well. In sum, the findings highlight that quality, not just quantity, is important for attaining fair negotiation outcomes.

Studies using the Ultimatum Game have shown that participants reject unfair offers extended by another person although this incurs a financial cost. Previous research suggests that one possible explanation for this apparently self-defeating response is that unfair offers involve strong negative responses that decrease the chances of responders accepting offers that would objectively constitute a net profit. We tested the hypothesis that one way of reducing responders’ rejections of unfair offers is through increased psychological distance, so that participants move away from the concrete feeling of being unfairly treated. Social distance was manipulated by having participants play the Ultimatum Game either for themselves, or for another person. Compared to deciding for one’s self or a close social contact, participants showed less sensitivity to fairness when deciding for a stranger, as indicated by fewer rejected unfair offers. We suggest that social distance helps people move beyond immediate fairness concerns in the Ultimatum Game.

We develop a modified ultimatum game, in which the proposer gives two offers, and the responder selects one offer out of the two without seeing them. Then, the selected offer becomes the relevant offer, and the unselected offer becomes the irrelevant one. Finally, the responder evaluates the fairness of the pair of offers and makes a hypothetical decision whether to accept or reject the relevant offer. For most of our subjects, the level of the irrelevant offer positively affects fairness perceptions and willingness to accept, even though the irrelevant offer cannot be accepted. The reason is that the irrelevant offer does signal the proposer’s intentions. Most responders give more weight to the relevant offer than to the irrelevant offer in evaluating fairness and in the willingness to accept. We call this effect the relevance effect. This effect is expected when considering the willingness to accept. However, it is unclear why the relevant offer should carry more weight when evaluating fairness, because the proposer makes the two offers together without knowing which one will become the relevant one. Therefore, this behavior can be considered a bias in fairness evaluations.

In the ultimatum game, one player proposes a split of money between him- or herself and another player, who can accept the offer (and both players keep the allocated money) or reject the offer (and both players get nothing). The present study examined predictors of accepting unfair ultimatum offers. In Study 1, 184 participants responded to an unfair ultimatum offer, completed a measure of cognitive reflection, and completed a self-report measure of rational and experiential thinking. Slightly more than half of the participants (54.3%) accepted the unfair offer, and cognitive reflection was positively correlated with accepting unfair offers. The rational and experiential thinking scales were not significantly correlated with ultimatum decisions. In Study 2, 306 participants responded to 20 ultimatum offers that varied in fairness and completed an expanded measure of cognitive reflection. Performance on the cognitive reflection measure predicted the number of ultimatum offers accepted. These results suggest that rejecting ultimatum offers is related to intuitive, heuristic-based thinking, whereas accepting offers is related to deliberate, analytic-based thinking.

In social interaction, the facial expression of an opponent contains information that may influence the interaction. We asked whether facial expression affects decision-making in the ultimatum game. In this two-person game, the proposer divides a sum of money into two parts, one for each player, and then the responder decides whether to accept the offer or reject it. Rejection means that neither player gets any money. Results of a large-sample study support our hypothesis that offers from proposers with a smiling facial expression are more often accepted, compared to a neutral facial expression. Moreover, we found lower acceptance rates for offers from proposers with an angry facial expression.

Krupka and Weber (2013) introduce an incentive-compatible coordination game as an alternative method for elicitation of normative judgments. I show, however, that people provide virtually the same responses in incentivized and non-incentivized versions of the Krupka-Weber game. Besides ratings of social appropriateness, I also elicit ratings of fairness of all possible offers in an ultimatum game. Ratings of social appropriateness and fairness are similar for low offers (below or equal to the equal split), but not for high offers which are judged to be more appropriate than fair.

In two studies, we tested the power of revenge as a justification mechanism thatenables people to cheat with a clear conscience. Specifically, we explored theeffects of prior dishonesty and unfairness towards participants on theirsubsequent moral behavior, as well as the physiological arousal associated withit. To this end, we employed a two-phase procedure. In the first phase,participants played one round of a bargaining game (the Ultimatum game in Study1 and the Dictator game in Study 2) in which we manipulated whether the playershad been treated (un)fairly and (dis)honestly by their opponent. In the secondphase, they did a perceptual task that allowed them to cheat for monetary gainat the expense of their opponent from the first phase. In Study 1, participantsalso took a lie detector test to assess whether their dishonesty in the secondphase could be detected. The behavioral results in both studies indicated thatthe opponent’s dishonesty was a stronger driver than theopponent’s unfairness for cheating as a form of retaliation. However, thephysiological arousal results suggest that feeling mistreated in general (andnot just cheated) allowed the participants to get revenge by cheating theoffender while dismissing their associated guilt feelings.

The ultimatum and dictator games were developed to help identify the fundamental motivators of human behavior, typically by asking participants to share windfall endowments with other persons. In the ultimatum game, a common observation is that proposers offer, and responders refuse to accept, a much larger share of the endowment than is predicted by rational choice theory. However, in the real world, windfalls are rare: money is usually earned. I report here a small study aimed at testing how participants react to an ultimatum game after they have earned their endowments by either building a Lego model or spending some time sorting out screws by their length. I find that the shares that proposers offer and responders accept are significantly lower than that typically observed with windfall money, an observation that is intensified when the task undertaken to earn the endowment is generally less enjoyable and thus perhaps more effortful (i.e., screw sorting compared to Lego building). I suggest, therefore, that considerations of effort-based desert are often important drivers behind individual decision-making, and that laboratory experiments, if intended to inform public policy design and implementation, ought to mirror the broad characteristics of the realities that people face.

A considerable share of the literature on the evolution of human cooperation considers the question why we have not evolved to play the Nash equilibrium in prisoners’ dilemmas or public goods games. In order to understand human morality and pro-social behaviour, we suggest that it would actually be more informative to investigate why we have not evolved to play the subgame perfect Nash equilibrium in sequential games, such as the ultimatum game and the trust game. The ‘rationally irrational’ behaviour that can evolve in such games gives a much better match with actual human behaviour, including elements of morality such as honesty, responsibility and sincerity, as well as the more hostile aspects of human nature, such as anger and vengefulness. The mechanism at work here is commitment, which does not need population structure, nor does it need interactions to be repeated. We argue that this shift in focus can not only help explain why humans have evolved to know wrong from right, but also why other animals, with similar population structures and similar rates of repetition, have not evolved similar moral sentiments. The suggestion that the evolutionary function of morality is to help us commit to otherwise irrational behaviour stems from the work of Robert Frank (American Economic Review, 77(4), 593–604, 1987; Passions within reason: The strategic role of the emotions, WW Norton, 1988), which has played a surprisingly modest role in the scientific debate to date.

This study aimed to examine the relationship between perspective-taking and impaired decision-making in patients with ventromedial prefrontal (VM) lesions, using the Ultimatum Game (UG). In the UG, two players split a sum of money and one player proposes a division while the other can accept or reject this. Eight patients with VM damage and 18 healthy controls participated as responders in a modified version of the UG, in which identical offers can generate different rejection rates depending on the other offers available to the proposer. Participants had to either accept or reject offers of 2:8 NIS (2NIS for them and 8 NIS for the proposer), which were paired with one of four different possible offers (5:5, 4:6, 2:8, 8:2). Results indicate that the controls more often rejected offers of 2:8 when the alternative was 4:6 (a greedy alternative) than when the alternative was 5:5 (fair alternative), whereas the VM patients showed the opposite pattern of decision-making. Additionally, the overall rejection rates were higher in patients as compared to controls. Furthermore, scores on a perspective-taking scale were negatively correlated with rejection rates in the patient group, suggesting that perspective-taking deficits may account for impaired decision-making in VM patients. (JINS, 2012, 18, 952–961)

Researchers from across the social sciences have found consistent deviations from the predictions of the canonical model of self-interest in hundreds of experiments from around the world. This research, however, cannot determine whether the uniformity results from universal patterns of human behavior or from the limited cultural variation available among the university students used in virtually all prior experimental work. To address this, we undertook a cross-cultural study of behavior in ultimatum, public goods, and dictator games in a range of small-scale societies exhibiting a wide variety of economic and cultural conditions. We found, first, that the canonical model – based on self-interest – fails in all of the societies studied. Second, our data reveal substantially more behavioral variability across social groups than has been found in previous research. Third, group-level differences in economic organization and the structure of social interactions explain a substantial portion of the behavioral variation across societies: the higher the degree of market integration and the higher the payoffs to cooperation in everyday life, the greater the level of prosociality expressed in experimental games. Fourth, the available individual-level economic and demographic variables do not consistently explain game behavior, either within or across groups. Fifth, in many cases experimental play appears to reflect the common interactional patterns of everyday life.