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On the Nature of Fair Behavior

Author

Listed:
  • Armin Falk

    (University of Zurich, Institute for Empirical Research in Economics, Bluemlisalpstreasse 10, CH-8006 Zurich, Switzerland.)

  • Ernst Fehr

    (University of Zurich, Institute for Empirical Research in Economics, Bluemlisalpstreasse 10, CH-8006 Zurich, Switzerland.)

  • Urs Fischbacher

    (Institute for Empirical Research in Economics, Bluemlisalpstreasse 10, CH-8006 Zurich, Switzerland.)

Abstract

This article shows that identical offers in an ultimatum game generate systematically different rejection rates depending on the other offers that are available to the proposer. This result casts doubt on the consequentialist practice in economics to define the utility of an action solely in terms of the consequences of the action irrespective of the set of alternatives. It means in particular that negatively reciprocal behavior cannot be fully captured by equity models that are exclusively based on preferences over the distribution of material payoffs. Copyright 2003, Oxford University Press.

Suggested Citation

  • Armin Falk & Ernst Fehr & Urs Fischbacher, 2003. "On the Nature of Fair Behavior," Economic Inquiry, Western Economic Association International, vol. 41(1), pages 20-26, January.
  • Handle: RePEc:oup:ecinqu:v:41:y:2003:i:1:p:20-26
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    References listed on IDEAS

    as
    1. Brandts, Jordi & Sola, Carles, 2001. "Reference Points and Negative Reciprocity in Simple Sequential Games," Games and Economic Behavior, Elsevier, vol. 36(2), pages 138-157, August.
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    More about this item

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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