Expectations in the Ultimatum Game

Abstract

Being treated fairly by others is an important social need. Experimentally, fairness can be studied using the Ultimatum Game in which the decision to reject a low, but non-zero, offer is seen as a way to punish the other player for an unacceptable division. The canonical explanation of such behavior is inequity aversion: people prefer equal outcomes over personal gains (Fehr, Schmidt, 1999). However, there is abundant evidence that the decision to reject a low offer can be changed by both contextual factors and emotional state, which cannot be satisfactorily explained by the inequity aversion model.


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