Participation costs for responders can reduce rejection rates in ultimatum bargaining
AbstractThis paper reports data from an ultimatum mini-game in which responders first had to choose whether or not to participate. Participation was costly, but the participation cost was smaller than the minimum payoff that a responder could guarantee himself in the ultimatum game. Compared to a standard treatment, we find that the rejection rate of unfavorable offers is significantly reduced when participation is costly. A possible explanation based on cognitive dissonance is offered.
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Bibliographic InfoPaper provided by Institute for Empirical Research in Economics - University of Zurich in its series IEW - Working Papers with number 398.
Date of creation: Dec 2008
Date of revision:
Cognitive dissonance; Participation costs; Sunk costs; Ultimatum game;
Other versions of this item:
- Wichardt, Philipp C. & Schunk, Daniel & Schmitz, Patrick W., 2009. "Participation costs for responders can reduce rejection rates in ultimatum bargaining," Economics Letters, Elsevier, vol. 103(1), pages 33-35, April.
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- 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-2009-01-03 (All new papers)
- NEP-CBE-2009-01-03 (Cognitive & Behavioural Economics)
- NEP-EXP-2009-01-03 (Experimental Economics)
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