Unstructured Bargaining over an Endogenously Produced Surplus and Fairness Ideals – An Experiment
AbstractFairness considerations are important determinants of behavior in unstructured bargaining situations with equal bargaining power. If the surplus over which the bargaining takes place was created by separate, individual efforts, several entitlement-related fairness ideals might be relevant. In our experiment we first elicit subjects’ fairness ideals using a questionnaire. In the following production phase each player generates output by luck, individual effort and talent. We analyze whether the elicited fairness ideals guide subjects’ behavior in the subsequent bargaining in which the joint output is distributed among two individuals. We find that bargaining claims deviate significantly from the elicited fairness ideals and are strongly related to performance if one individual had produced more than the partner. These findings contrast the previous literature on fairness ideals and enrich the findings on self-serving fairness.
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Bibliographic InfoPaper provided by Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen in its series Ruhr Economic Papers with number 0439.
Length: 40 pages
Date of creation: Aug 2013
Date of revision:
Other versions of this item:
- Wolfgang J. Luhan & Odile Poulsen & Michael W.M. Roos, 2013. "Unstructured Bargaining over an Endogenously Produced Surplus and Fairness Ideals – An Experiment," Ruhr Economic Papers 0438, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- D39 - Microeconomics - - Distribution - - - Other
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-10-05 (All new papers)
- NEP-CBE-2013-10-05 (Cognitive & Behavioural Economics)
- NEP-EXP-2013-10-05 (Experimental Economics)
- NEP-GTH-2013-10-05 (Game Theory)
- NEP-HPE-2013-10-05 (History & Philosophy of Economics)
- NEP-HRM-2013-10-05 (Human Capital & Human Resource Management)
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