Hostname: page-component-7b9c58cd5d-9klzr Total loading time: 0 Render date: 2025-03-17T07:35:35.462Z Has data issue: false hasContentIssue false
  • English
  • Français

Testing subgame perfection apart from fairness in ultimatum games

Published online by Cambridge University Press:  14 March 2025

James Andreoni  and
Emily Blanchard
James Andreoni*
Affiliation:
Department of Economics, University of California, San Diego, CA 92093
Emily Blanchard
Affiliation:
Department of Economics, University of Virginia, Charlottesville, VA 22904
*
e-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

We present an experiment designed to separate the two commonplace explanations for behavior in ultimatum games—subjects’ concern for fairness versus the failure of subgame perfection as an equilibrium refinement. We employ a tournament structure of the bargaining interaction to eliminate the potential for fairness to influence behavior. Comparing the results of the tournament game with two control treatments affords us a clean test of subgame perfection as well as a measure fairness-induced play. We find after 10 iterations of play that about half of all non-subgame-perfect demands are due to fairness, and the rest to imperfect learning. However, as suggested by models of learning, we also confirm that the ultimatum game presents an especially difficult environment for learning subgame perfection.

Keywords

Utimatum gameSubgame perfectionFairnessLearning

JEL classification

D64: Altruism • Philanthropy • Intergenerational Transfers J52: Dispute Resolution: Strikes, Arbitration, and Mediation • Collective Bargaining C91: Laboratory, Individual Behavior
Type
Research Article
Information
Experimental Economics , Volume 9 , Issue 4 , December 2006 , pp. 307 - 321
Copyright
Copyright © 2006 Economic Science Association

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

Electronic Supplementary Material Supplementary material is available in the online version of this article at http://dx.doi.org/10.1007/s10683-006-0064-7.

References

Abbink, K., Bolton, G., Sadrieh, A., & Tang, F. (2001). Adaptive learning versus punishment in ultimatum bargaining. Games and Economic Behavior, 37(1), 1–25.CrossRefGoogle Scholar
Andreoni, J. (1995). Cooperation in public-goods experiments: Kindness or confusion? American Economic Review, 85(4), 891–904.Google Scholar
Andreoni, J., Castillo, M., & Petrie, R. (2003). What do bargainers’ preferences look like? Exploring a convex ultimatum game. American Economic Review, 93(3), 672–685.CrossRefGoogle Scholar
Andreoni, J., Castillo, M., & Petrie, R. (2004). Revealing preferences for fairness in ultimatum bargaining: Parametric and non-parametric estimates of preferences, working paper, University of Wisconsin.Google Scholar
Bolton, G. (1991). A comparative model of bargaining: Theory and evidence. American Economic Review, 81(5), 1096–1136.Google Scholar
Bolton, G., & Ockenfels, A. (2000). ERC: A theory of equity, reciprocity, and competition. American Economic Review, 90(1), 166–193.CrossRefGoogle Scholar
Camerer, C., & Ho, T. (1999). Experience-weighted attraction learning in normal form games. Econometrica, 67(4), 827–874.CrossRefGoogle Scholar
Erev, I., & Roth, A. (1995). Learning in extensive-form games: Experimental data and simple dynamic models in the intermediate term. Games and Economic Behavior, 8(1), 164–212.Google Scholar
Fehr, E., & Schmidt, K. (1999). Theory of fairness, competition, and cooperation. Quarterly Journal of Economics, 114(3), 817–868.CrossRefGoogle Scholar
Fudenberg, D., & Levine, D. (1997). Measuring players’ losses in experimental games. Quarterly Journal of Economics, 112(2), 507–536.CrossRefGoogle Scholar
Gale, J., Binmore, K., & Samuelson, L. (1995). Learning to be imperfect: The ultimatum game. Games and Economic Behavior, 8(1), 56–90.CrossRefGoogle Scholar
Goeree, J., & Holt, C. (2000). Asymmetric inequality aversion and noisy behavior in alternating-offer bargaining games. European Economic Review, 44, 1079–1089.CrossRefGoogle Scholar
Guth, W., Schmittberger, R., & Schwarze, B. (1982). An experimental analysis of ultimatum bargaining. Journal of Economic Behavior and Organization, 3(4), 367–388.CrossRefGoogle Scholar
Houser, D., & Kurzban, R. (2002). Revisiting kindness and confusion in public goods experiments. American Economic Review, 94(4), 1062–1069.CrossRefGoogle Scholar
Li, J. (2004). A model of ethical behavior, working paper. University of Wisconsin—Madison.Google Scholar
Ochs, J., & Roth, A. E. (1989). An experimental study of sequential bargaining. American Economic Review, 79(3), 355–384.Google Scholar
Rabin, M. (1993). Incorporating fairness into game theory and economics. American Economic Review, 83(5), 1281–1302.Google Scholar
Rabin, M., & Charness, G. (2002). Understanding social preferences with simple tests. Quarterly Journal of Economics, 117, 817–861.Google Scholar
Roth, A. E., Prasnikar, V., Okunofujiwara, M., & Zamir, S. (1991). Bargaining and market behavior in Jerusalem, Ljubljana, Pittsburgh, and Tokyo: An experimental study. American Economic Review, 81(5), 1068–1095.Google Scholar
Slonim, R., & Roth, A. (1998). Learning inhigh stakes ultimatum games: An experiment in the slovak republic. Econometrica, 66(3), 569–596.CrossRefGoogle Scholar
Supplementary material: File

Andreoni and Blanchard supplementary material

Andreoni and Blanchard supplementary material 1
Download Andreoni and Blanchard supplementary material(File)
File 9.2 KB
Supplementary material: File

Andreoni and Blanchard supplementary material

Andreoni and Blanchard supplementary material 2
Download Andreoni and Blanchard supplementary material(File)
File 9.2 KB
Supplementary material: File

Andreoni and Blanchard supplementary material

Andreoni and Blanchard supplementary material 3
Download Andreoni and Blanchard supplementary material(File)
File 9.2 KB