The ultimatum game: Discrete vs. continuous offers

Miriam Dishon-Berkovits and Richard Berkovits

Physica A: Statistical Mechanics and its Applications, 2014, vol. 409, issue C, 53-60

Abstract: In many experimental setups in social-sciences, psychology and economy the subjects are requested to accept or dispense monetary compensation which is usually given in discrete units. Using computer and mathematical modeling we show that in the framework of studying the dynamics of acceptance of proposals in the ultimatum game, the long time dynamics of acceptance of offers in the game are completely different for discrete vs. continuous offers. For discrete values the dynamics follow an exponential behavior. However, for continuous offers the dynamics are described by a power-law. This is shown using an agent based computer simulation as well as by utilizing an analytical solution of a mean-field equation describing the model. These findings have implications to the design and interpretation of socio-economical experiments beyond the ultimatum game.

Keywords: Altruistic punishment; Ultimatum game; Agent-based model; Power-law distribution; Fairness; Group dynamics (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:409:y:2014:i:c:p:53-60

DOI: 10.1016/j.physa.2014.04.039

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