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Responders’ dissatisfaction may provoke fair offer

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  • Wenxin Xie
  • Yong Li
  • Yougui Wang
  • Keqiang Li

Abstract

In this article, we attempt to explain the fair outcome of ultimatum game experiments using the evolutionary dynamics. The players of the game, the proposers and the responders, are randomly matched to play the game. When the responders face low offers from the proposers, their decisions are influenced by not only the monetary payoff but also their feelings. To quantify the responders’ feelings, a degree of dissatisfaction is introduced into the game. Asymmetrical replicator dynamics is used to study the evolution of the proportion of players with different strategies. The solutions of the differential equations exhibit complex outcomes mainly depending on the degree of dissatisfaction. It could also be inferred from our results that people can maintain their rights and interests well when they have a strong sense of unfairness. Copyright Springer-Verlag 2012

Suggested Citation

  • Wenxin Xie & Yong Li & Yougui Wang & Keqiang Li, 2012. "Responders’ dissatisfaction may provoke fair offer," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 7(2), pages 197-207, October.
    • Handle: RePEc:spr:jeicoo:v:7:y:2012:i:2:p:197-207
    DOI: 10.1007/s11403-012-0092-7
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    More about this item

    Keywords

    Sub-game perfect; Replicator dynamics; Evolutionary equilibrium; C73; D03; D63;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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