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The Impact of Exchange Context on the Activation of Equity in Ultimatum Games

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  • Elizabeth Hoffman
  • Kevin McCabe
  • Vernon Smith

Abstract

In this paper we report the results of additional exchange ultimatum game experiments conducted at the same time as the exchange ultimatum game experiments reported in Hoffman et al. (Games and Economic Behavior, 7(3), pp. 346–380, 1994). In these additional experiments, we use instructions to change an impersonal exchange situation to a personal exchange situation. To do this, we prompt sellers to consider what choices their buyers will make. Game theory would predict that thinking about the situation would lead sellers to make smaller offers to buyers. In contrast, we find a significant increase in seller offers to buyers. This result suggests that encouraging sellers to thinking about buyer choices focuses their attention on the strategic interaction with humans who think they way they do in personal exchange situations, and who may punish them for unacceptable behavior, and not on the logic of the game theoretic structure of the problem. Copyright Kluwer Academic Publishers 2000

Suggested Citation

  • Elizabeth Hoffman & Kevin McCabe & Vernon Smith, 2000. "The Impact of Exchange Context on the Activation of Equity in Ultimatum Games," Experimental Economics, Springer;Economic Science Association, vol. 3(1), pages 5-9, June.
    • Handle: RePEc:kap:expeco:v:3:y:2000:i:1:p:5-9
    DOI: 10.1023/A:1009925123187
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    1. Hoffman Elizabeth & McCabe Kevin & Shachat Keith & Smith Vernon, 1994. "Preferences, Property Rights, and Anonymity in Bargaining Games," Games and Economic Behavior, Elsevier, vol. 7(3), pages 346-380, November.
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    Cited by:

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    2. Ilaria Castelli & Davide Massaro & Alan Sanfey & Antonella Marchetti, 2010. "Fairness and intentionality in children’s decision-making," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 57(3), pages 269-288, September.
    3. Sally, David & Hill, Elisabeth, 2006. "The development of interpersonal strategy: Autism, theory-of-mind, cooperation and fairness," Journal of Economic Psychology, Elsevier, vol. 27(1), pages 73-97, February.
    4. Massimo Castro, 2006. "Cultural goods and laboratory experiments," International Review on Public and Nonprofit Marketing, Springer;International Association of Public and Non-Profit Marketing, vol. 3(1), pages 67-79, June.
    5. Kamas, Linda & Preston, Anne, 2021. "Empathy, gender, and prosocial behavior," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 92(C).
    6. Güth, Werner & Kocher, Martin G., 2014. "More than thirty years of ultimatum bargaining experiments: Motives, variations, and a survey of the recent literature," Journal of Economic Behavior & Organization, Elsevier, vol. 108(C), pages 396-409.
    7. Klaus Abbink & Heike Hennig-Schmidt, 2006. "Neutral versus loaded instructions in a bribery experiment," Experimental Economics, Springer;Economic Science Association, vol. 9(2), pages 103-121, June.
    8. Smith, Vernon L., 2010. "Theory and experiment: What are the questions?," Journal of Economic Behavior & Organization, Elsevier, vol. 73(1), pages 3-15, January.
    9. Vernon Smith, 2002. "Method in Experiment: Rhetoric and Reality," Experimental Economics, Springer;Economic Science Association, vol. 5(2), pages 91-110, October.
    10. Lusk, Jayson L. & Hudson, Darren, 2004. "Effect of monitor-subject cheap talk on ultimatum game offers," Journal of Economic Behavior & Organization, Elsevier, vol. 54(3), pages 439-443, July.
    11. Finocchiaro Castro Massimo, 2004. "Cultural Education and the Voluntary Provision of Cultural Goods: An Experimental Study," Experimental 0404002, University Library of Munich, Germany.
    12. Houser, Daniel & McCabe, Kevin & Smith, Vernon, 2004. "Cultural group selection, co evolutionary processes and large-scale cooperation (by Joseph Henrich)," Journal of Economic Behavior & Organization, Elsevier, vol. 53(1), pages 85-88, January.
    13. Paola Iannello & Alessandro Antonietti, 2008. "Reciprocity in financial decision making: intuitive and analytical mind-reading strategies," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 55(1), pages 167-184, April.
    14. Zak, Paul J., 2011. "The physiology of moral sentiments," Journal of Economic Behavior & Organization, Elsevier, vol. 77(1), pages 53-65, January.
    15. Colin Camerer & Teck-Hua Ho & Juin Kuan Chong, 2003. "A cognitive hierarchy theory of one-shot games: Some preliminary results," Levine's Bibliography 506439000000000495, UCLA Department of Economics.
    16. Novarese, Marco & Chelini, Chiara & Spada, Anna & Ambrosino, Angela & Trigona, Carla, 2010. "An Experimental Investigation on Learning and Context Effects," MPRA Paper 27807, University Library of Munich, Germany.
    17. Grimalda, Gianluca & Kar, Anirban & Proto, Eugenio, 2008. "The Impact of (In)Equality of Opportunities on Wealth Distribution : Evidence from Ultimatum Games," The Warwick Economics Research Paper Series (TWERPS) 843, University of Warwick, Department of Economics.

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