Investigating Role of Social Value Orientation in Individual’s Decision-Making Evidence from the Ultimatum Game

In the conventional literature of economics, human preferences are defined based on self-interest and independence from social contexts and norms. In practice, however, human behaviors and actions are seriously influenced by social norms (such as fairness and beliefs) individual’s and the mutual behavior of others. Given that people’s social values influence the decision-making process, this study aims to investigate individual’s social value orientations in hypothetical and real conditions. Therefore, the triple-dominance measure and the ultimatum game were used to determine the social orientation of individuals in hypothetical and real conditions, respectively. In total, 64 students were randomly selected from the faculty of Economics, University of Tabriz, and the required data were collected within two weeks in January 2019. Since the data were not normally distributed, the non-parametric techniques of Chi-square and Wilcoxon were employed to explain the correlation between the research variables. The results showed that the assumptions were very simplistic and misleading in the neoclassical economic paradigm. Individual’s personality traits and social value orientations affected their decisions, so that about 75% of people chose the equality strategy, instead of maximizing their self-interest. The results also indicated a significant difference in the strategies and decisions of the proposers in both hypothetical and real conditions. In other words, in addition to self-interest, the behavior and action of the dividers in the ultimatum game were a function of personality and environmental factors.