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Testing subgame perfection apart from fairness in ultimatum games

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  • Andreoni,J.
  • Blanchard,E.

    (University of Wisconsin-Madison, Social Systems Research Institute)

Abstract

We present an experiment designed to separate the two commonplace explanations for behavior in ultimatum games—subjects’ concern for fairness versus the failure of subgame perfection as an equilibrium refinement. We employ a tournament structure of the bargaining interaction to eliminate the potential for fairness to influence behavior. Comparing the results of the tournament game with two control treatments affords us a clean test of subgame perfection as well as a measure fairness-induced play. We find after 10 iterations of play that about half of all non-subgame-perfect demands are due to fairness, and the rest to imperfect learning. However, as suggested by models of learning, we also confirm that the ultimatum game presents an especially difficult environment for learning subgame perfection. Copyright Economic Science Association 2006

(This abstract was borrowed from another version of this item.)

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Bibliographic Info

Paper provided by Wisconsin Madison - Social Systems in its series Working papers with number 15.

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Date of creation: 2002
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Handle: RePEc:att:wimass:200215

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Postal: UNIVERSITY OF WISCONSIN MADISON, SOCIAL SYSTEMS RESEARCH INSTITUTE(S.S.R.I.), MADISON WISCONSIN 53706 U.S.A.

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  1. Gary Charness & Matthew Rabin, 1999. "Social preferences: Some simple tests and a new model," Economics Working Papers 441, Department of Economics and Business, Universitat Pompeu Fabra, revised Jan 2000.
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  4. Abbink, Klaus & Gary Bolton & Abdolkarim Sadrieh & Fang-Fang Tang, 1996. "Adaptive Learning versus Punishment in Ultimatum Bargaining," Discussion Paper Serie B 381, University of Bonn, Germany.
  5. Ernst Fehr & Klaus M. Schmidt, . "A Theory of Fairness, Competition and Cooperation," IEW - Working Papers 004, Institute for Empirical Research in Economics - University of Zurich.
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  17. Bolton, Gary E, 1991. "A Comparative Model of Bargaining: Theory and Evidence," American Economic Review, American Economic Association, vol. 81(5), pages 1096-136, December.
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Citations

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Cited by:
  1. Maruyama, Shiko, 2014. "Estimation of finite sequential games," Journal of Econometrics, Elsevier, vol. 178(2), pages 716-726.
  2. Vjollca Sadiraj & Juan Sun, 2012. "Efficiency in Bargaining Games with Alternating Offers," Economics Bulletin, AccessEcon, vol. 32(3), pages 2366-2374.
  3. David Cooper & E. Dutcher, 2011. "The dynamics of responder behavior in ultimatum games: a meta-study," Experimental Economics, Springer, vol. 14(4), pages 519-546, November.
  4. Normann, Hans-Theo & Requate, Till & Waichman, Israel, 2013. "Do short-term laboratory experiments provide valid descriptions of long-term economic interactions? A study of Cournot markets," DICE Discussion Papers 100, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
  5. McCain, Roger A., 2009. "Commitment and weakness of will in game theory and neoclassical economics," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(4), pages 549-556, August.
  6. McCain, Roger A., 2008. "Cooperative games and cooperative organizations," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(6), pages 2155-2167, December.
  7. Werner Güth & Martin G. Kocher, 2013. "More than Thirty Years of Ultimatum Bargaining Experiments: Motives, Variations, and a Survey of the Recent Literature," CESifo Working Paper Series 4380, CESifo Group Munich.
  8. Michał Krawczyk & Fabrice Le Lec, 2012. "Testing game theory without the social preference confound," Working Papers 2012-06, Faculty of Economic Sciences, University of Warsaw.
  9. Gautam Bose & Lorraine Ivancic & Evgenia Dechter, 2014. "Conforming to Group Norms: An Experimental Study," Discussion Papers 2014-21, School of Economics, The University of New South Wales.

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