Bargaining, Fairness and Conflict

Charles Holt and Katri K. Sieberg ()
Additional contact information
Katri K. Sieberg: Tampere University

Homo Oeconomicus: Journal of Behavioral and Institutional Economics, 2022, vol. 39, issue 2, No 9, 259-288

Abstract: Abstract A central issue in behavioral economics is the role of fairness, and whether it is hard-wired or acquired as a result of self-interested considerations. Binmore (Crooked thinking or straight talk: Modernizing epicurean scientific philosophy, Springer, 2020) has recently argued that fairness does not always occur, and when it does, it is caused by self-interest. The ultimatum game is well known for the sharp divergence of experimental data from theoretical predictions based on self-interest. Proposers frequently offer ‘fair’ shares of a fixed “pie” of potential earnings, and unfair offers are often rejected, which results in zero earnings for both bargainers. Slight modifications of the ultimatum game, however, can add a more realistic context for some applications, and the resulting gamesman-like behavior can yield results closer to theoretical predictions. This paper reports an experiment based on a modified ultimatum game in which rejection results in a costly conflict with a stochastic outcome. We observe gamesman-like offer behavior, especially after role reversal and learning. Conflict adds an element of competition and seems to play a role in teaching subjects what offers are appropriate—often moving demands away from fair divisions towards the game-theoretic predictions.

Keywords: Fairness; Ultimatum game; Conflict bargaining game; Laboratory experiment (search for similar items in EconPapers)
JEL-codes: C7 C73 C78 C9 D74 D9 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s41412-022-00130-x Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:homoec:v:39:y:2022:i:2:d:10.1007_s41412-022-00130-x

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/41412

DOI: 10.1007/s41412-022-00130-x

Access Statistics for this article

Homo Oeconomicus: Journal of Behavioral and Institutional Economics is currently edited by M.J. Holler, M. Kocher and K.K. Sieberg

More articles in Homo Oeconomicus: Journal of Behavioral and Institutional Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().