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How Does Voice Matter? Evidence from the Ultimatum Game

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  • Qiyan Ong

    ()

  • Steven M. Sheffrin

    ()
    (Department of Economics, Tulane University)

Abstract

Prior research in economics and psychology has shown that process can matter in determining outcomes in many social situations. In particular, the opportunity to express ones opinion-voice-has been found to be highly influential. However, little is known about the channels through which voice may operate. In this paper, we develop a simple economic model of voice to explore these channels. We show that individuals value voice for: 1) its effect on outcomes, 2) its inherent value, or 3) its role in signaling one's social standing. Through the introduction of a hypothetical round in the standard ultimatum game, we were able to test the channels of voice directly by observing recipients' responses to offers which are lower than what they asked for. Our experimental results suggest that voice works primarily through its inherent value which appears to exceed its contribution to the perception of procedural fairness. Further, unlike voice which softens the impact of an unfair outcome, the possibility for voice may have dichotomous effects.

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File URL: http://econ.tulane.edu/RePEc/pdf/tul1004.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by Tulane University, Department of Economics in its series Working Papers with number 1004.

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Length: 25 pages
Date of creation: Sep 2010
Date of revision:
Handle: RePEc:tul:wpaper:1004

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Keywords: voice; ultimatum game;

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References

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  1. Hoffman, Elizabeth & McCabe, Kevin A & Smith, Vernon L, 1996. "On Expectations and the Monetary Stakes in Ultimatum Games," International Journal of Game Theory, Springer, vol. 25(3), pages 289-301.
  2. Crawford, Vincent, 1998. "A Survey of Experiments on Communication via Cheap Talk," Journal of Economic Theory, Elsevier, vol. 78(2), pages 286-298, February.
  3. Fehr, Ernst & Schmidt, Klaus M., 1999. "A theory of fairness, competition, and cooperation," Munich Reprints in Economics 20650, University of Munich, Department of Economics.
  4. Matthew Rabin, 2006. "A Model of Reference-Dependent Preferences," The Quarterly Journal of Economics, MIT Press, vol. 121(4), pages 1133-1165, November.
  5. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1986. "Fairness and the Assumptions of Economics," The Journal of Business, University of Chicago Press, vol. 59(4), pages S285-300, October.
  6. Daniel Houser & Erte Xiao, 2011. "Classification of natural language messages using a coordination game," Experimental Economics, Springer, vol. 14(1), pages 1-14, March.
  7. Jordi Brandts & Gary Charness, 2011. "The strategy versus the direct-response method: a first survey of experimental comparisons," Experimental Economics, Springer, vol. 14(3), pages 375-398, September.
  8. Roth, Alvin E. & Erev, Ido, 1995. "Learning in extensive-form games: Experimental data and simple dynamic models in the intermediate term," Games and Economic Behavior, Elsevier, vol. 8(1), pages 164-212.
  9. Dolan, Paul & Edlin, Richard & Tsuchiya, Aki & Wailoo, Allan, 2007. "It ain't what you do, it's the way that you do it: Characteristics of procedural justice and their importance in social decision-making," Journal of Economic Behavior & Organization, Elsevier, vol. 64(1), pages 157-170, September.
  10. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
  11. John List & Todd Cherry, 2000. "Learning to Accept in Ultimatum Games: Evidence from an Experimental Design that Generates Low Offers," Experimental Economics, Springer, vol. 3(1), pages 11-29, June.
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Cited by:
  1. Marco Kleine & Pascal Langenbach & Lilia Zhurakhovska, 2013. "How Voice Shapes Reactions to Impartial Decision Makers: An Experiment," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2013_11, Max Planck Institute for Research on Collective Goods, revised Feb 2014.
  2. Mertins, Vanessa & Egbert, Henrik & K├Ânen, Tanja, 2013. "The effects of individual judgments about selection procedures: Results from a power-to-resist game," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 42(C), pages 112-120.
  3. Qiyan ONG & Yohanes Eko RIYANTO & Walter E. THESEIRA & Steven M. SHEFFRIN, 2013. "The Self-Image Signaling Roles of Voice in Decision-Making," Economic Growth centre Working Paper Series 1303, Nanyang Technolgical University, School of Humanities and Social Sciences, Economic Growth centre.

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