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Explaining Unfair Offers in Ultimatum Games and their Effects on Trust: An Experimental Approach

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  • De Cremer, David
  • van Dijk, Eric
  • Pillutla, Madan M.

Abstract

Unfair offers in bargaining may have disruptive effects because they may reduce interpersonal trust. In such situations future trust may be strongly affected by social accounts (i.e., apologies vs. denials). In the current paper we investigate when people are most likely to demand social accounts for the unfair offer (Experiment 1), and when social accounts will have the highest impact (Experiment 2). We hypothesized that the need for and impact of social accounts will be highest when the intentions of the other party are uncertain. The results provided support for this reasoning.

Suggested Citation

  • De Cremer, David & van Dijk, Eric & Pillutla, Madan M., 2010. "Explaining Unfair Offers in Ultimatum Games and their Effects on Trust: An Experimental Approach," Business Ethics Quarterly, Cambridge University Press, vol. 20(1), pages 107-126, January.
    • Handle: RePEc:cup:buetqu:v:20:y:2010:i:01:p:107-126_00
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    Citations

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    Cited by:

    1. Filipe Sobral & Gazi Islam, 2013. "Ethically Questionable Negotiating: The Interactive Effects of Trust, Competitiveness, and Situation Favorability on Ethical Decision Making," Journal of Business Ethics, Springer, vol. 117(2), pages 281-296, October.
    2. Schniter, Eric & Sheremeta, Roman M. & Sznycer, Daniel, 2013. "Building and rebuilding trust with promises and apologies," Journal of Economic Behavior & Organization, Elsevier, vol. 94(C), pages 242-256.
    3. Krista Hill & David Boyd, 2015. "Who Should Apologize When an Employee Transgresses? Source Effects on Apology Effectiveness," Journal of Business Ethics, Springer, vol. 130(1), pages 163-170, August.
    4. Tucker, Danielle A. & Hendy, Jane & Barlow, James, 2016. "The dynamic nature of social accounts: An examination of how interpretive processes impact on account effectiveness," Journal of Business Research, Elsevier, vol. 69(12), pages 6079-6087.
    5. Desmet, Pieter T.M. & Cremer, David De & Dijk, Eric van, 2011. "In money we trust? The use of financial compensations to repair trust in the aftermath of distributive harm," Organizational Behavior and Human Decision Processes, Elsevier, vol. 114(2), pages 75-86, March.
    6. Ben Gilbert & Alexander James & Jason F. Shogren, 2018. "Corporate apology for environmental damage," Journal of Risk and Uncertainty, Springer, vol. 56(1), pages 51-81, February.
    7. Eric Schniter & Roman M. Sheremeta & Daniel Sznycer, 2011. "Restoring Damaged Trust with Promises, Atonement and Apology," Working Papers 11-18, Chapman University, Economic Science Institute.
    8. Leunissen, Joost M. & Cremer, David De & Reinders Folmer, Christopher P., 2012. "An instrumental perspective on apologizing in bargaining: The importance of forgiveness to apologize," Journal of Economic Psychology, Elsevier, vol. 33(1), pages 215-222.
    9. Dijke, Marius van & Cremer, David De, 2011. "When social accounts promote acceptance of unfair ultimatum offers: The role of the victim's stress responses to uncertainty and power position," Journal of Economic Psychology, Elsevier, vol. 32(3), pages 468-479, June.
    10. De Cremer, David, 2010. "To pay or to apologize? On the psychology of dealing with unfair offers in a dictator game," Journal of Economic Psychology, Elsevier, vol. 31(6), pages 843-848, December.
    11. Pedro FrancŽs-G—mez & Lorenzo Sacconi & Marco Faillo, 2012. "Behavioral Business Ethics as a Method for Normative Business Ethics," Econometica Working Papers wp42, Econometica.

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