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On the Nature of Fair Behaviour

Author

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  • Fehr, Ernst
  • Falk, Armin
  • Fischbacher, Urs

Abstract

This Paper 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 of defining 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 behaviour cannot be fully captured by equity models that are exclusively based on preferences over the distribution of material pay-offs. Models that take into account players? fairness intentions and distributional preferences are consistent with our data while models that focus exclusively on intentions or on the distribution of material pay-offs are not.

Suggested Citation

  • Fehr, Ernst & Falk, Armin & Fischbacher, Urs, 2001. "On the Nature of Fair Behaviour," CEPR Discussion Papers 2984, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:2984
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    8. Vesna Prasnikar & Alvin E. Roth, 1992. "Considerations of Fairness and Strategy: Experimental Data from Sequential Games," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(3), pages 865-888.
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    More about this item

    Keywords

    Fairness; Intentions; Models of fairness;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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