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Inequity aversion, reciprocity, and appropriateness in the ultimatum-revenge game

Authors
Publisher
Max Planck Inst. for Research on Collective Goods Bonn
Publication Date
Keywords
  • D63
  • D64
  • Ddc:330
  • Distributional Preferences
  • Fairness
  • Intentional Based Preferences
  • Social Welfare
  • Ultimatum Bargaining
  • Verhandlungstheorie
  • Verteilungsgerechtigkeit
  • Reziprozit√§t
  • Test

Abstract

This article reports the results of a simple bargaining experiment on the ultimatum-revenge game. The game enables to differentiate between fairness that is stimulated by intentional based motives, distributional motives, and fairness considerations that mix both motives. The laboratory experiments indicate considerable heterogeneity of motives. A majority of subjects seem to combine both motives. However, the composition of the mix is subject to a transition, which can be formalized by the principle of appropriateness. In contrast to contemporary reciprocity models, this approach suggests that mildly unkind treatments are responded mildly unkindly, while strong unkindness leads to harsh reactions.

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