Quick & Dirty Literature Review for the Ultimatum Game

Nothing particularly interesting. Merely a rough draft, using all new (to me) sources, of the nature of the ultimatum bargaining game. I presume that in an expanded and improved form this will re-appear, but for now I am posting it for my own reference.

Read on only if you’re very interested, or very bored.

Research has been done with gameplay and learning disabled students, such as autistics (Sally & Hill, 2006). It also also shown how attractive people both receive higher shares and are expected to give more (Solnick & Schweister, 1999), and likewise how being participants artificially divded into high and low status groups treat each other differently (Ball and Eckel, 1996), It has even be shown how research itself is a type of ultimatum game (Bonetti, 1998).

At least among some cultural groups, adolescents are more generous than adults (Hoffmann & Tee, 2006). Relatedly, moral reasoning in game play increases in early adolescence — between the ages of 11 and 13 (Takezawa, Gummerum, & Keller, 2006). Reasoning takes ability into account. For instance, players act as if higher-skill players should earn more, but lower-skill players should not be expected to give as much (Ruffle 1998).

People use different strategies while playing the ultimatum game. Researchers in Russia observed that play-types seem to split into players who want at least a fair outcome for themselves and those who want a fair outcome for both players (Bahry & Wilson, 2006). Another study observed that players seem to be split into those who are sensitive to other’s injustice to them, to injustice against others, and unjust profiting (Fetchenhauer & Huang, 2004). An unfair action is more likely to be perceived to be injust if it was intentional as opposed to unintentional (Kagel, Kim, & Moser, 1996).

Game play also varies across type of game. For instance, players who maximize for expected reward may behave fairly in ultimatum games but unfairly in dictator games (Haselhuhn & Mellers, 2005) and behave more fairly when making one decision at a time than many decisions simultaneously (Bazerman, White, & Lowenstein, 1995). Similarly, behavior in the ultimatum game changes if the actions are described in terms of an everyday social interaction rather than as straight-forward bargaining (Larrick & Blount, 1997).

Still, game performance is not static. Behavior in the ultimatum game is influenced by norms of a people (Henrich, et al., 2005) and even a workplace (Kay, Wheeler, Bagh, & Ross, 2004). Knowledge about theoretical performance maximizing behavior changes performance (Lusk & Hudson, 2004), as does group decision making (which appears to improve rational behavior) (Robert & Carnevale, 1997). Likewise, chaotic conditions make it harder to learn how to maximize performance for responders than for proposers (Gale, Binmore, & Samuelson, 1995).

Perceptions of distributive justice are important (Humprey, Ellis, Conlon, & Tinsley, 2004) as is honesty (Croson, Boles, & Murnighan, 2003). As feelings of guilty are also important (Ketelaar & Au, 2003). Thus, it is not surprising that social awareness and thus awareness of would-be fair outcomes changes behavior, too (Handgraaf, Dijk, Wilke, & Vermunt, 2003). Some of the consequcnes of this are nonintuitive: for instance, it can be better to play an economic game from a powerless position, and this appears to cause the other player to be more concerned for your welfare (van Dijk & Vermunt, 2000). Similarly, changing the relative power of the players does not substantially alter play performance (Weg & Smith, 1993).

Reciprocity in playing games means rewarding kind actions and punishing bad ones (Falk & Fischbacher, 2006). A similar concept, altruism in the ultimatum game has been observed in among the Nigerian Igos (Gowdy, Iorgulescu, & Onyweiwu, 2003). American lawyers, explaining decisions they had made, also listed fairness as a greater cause of their actions than envy or altruism-as-such (Bethwaite & Tompkinson, 1996).

The uttimatum game has also been studied through computer simulations. Adaptive algorithms can yield in-game behavior similar to that observed in humans (Calderon & Zarama, 2006). The computer programs show how fairness can evolve if players are generally able to know how the other agent has played in the past (Nowak, Page, & Sigmund, 2000).

The connection to game-play excellence with creativity is worth considering. Stubbornness and persistence are associated in computer simulations with success, but so is the less-well-regarded attitude of capriciousness (Napel, 2003). General personality traits, such as independence and tough-mindedness, are also important (Brandstatter & Konigstein, 2001);

Explicit beliefs matter, as well. An interaction between fair beliefs and self-interested explained begaining behavior in both Japan and the United States (Buchan, Croson, Johnson, & Iacobucci, 2004).
Technical measuring devises have been used to study ultimatum game behavior. For instance, the right dorsolateral prefrontal cortext (van ‘t Wout, Kahn, Sanfey, & Aleman, 2005) among other brain areas (Camerer, 2003).

The ultimatum game has been manipulated to create new games before. It has been changes to minimize the outcome of the proposing player (Gneezy, Haruvy, & Roth, 2003) as well as to incorporate elections (Sulkin & Simon, 2001) or democratic committe-style decision making (Messick, Moore, & Bazerman, 1997). Guth, Huck, and Muller altered it to prevent equal splits, and observed that proposed divisions decreased fair offers more than they expected (2001). Likewise, by reducing the size of the pie while decisions are being made, different choices are made (Suleiman, 1996). Similarly, when a rejection does not lead to all getting zero, but other predetermined positive figures, game play changes as well (Knez & Camerer, 1995). Further, when a third player is made completely dependent on the receiver player, it was found that the giving power is more generous and the receiving power less protective against exploitation (Oppewal & Tougareva, 1992).

A practical question is how the stakes of the game change behavior, and this is not nailed down yet. Increased stakes do seem to make subjects more pliant toward small rewards, but changing the stake size does not (Munier & Zaharia, 2002). Other researchers, while showing that reciprical kindness appears to explain most game behavior, note that the effective of changing the stakes is marginal when compared to the relative percentage offered (Dickenson, 2000).

Bahry, D.L., & Wilson, R.K. (2006). Confusion or fairness in the field? Rejections in the ultimatum game under the strategy method. Journal of Economic Behavior & Organization 60(1):37-54.
Bazerman, M.H., White, S.B., & Lowenstein, G.F. (1995). Perceptions of fairness in interpersonal and individual choice situations. Current Directions in Psychological Sciences 4(2): 39-43.
Ball, S.B., & Eckel, C.C. (1996). Buying status: Experimental evidence on status in negotiation. Psychology & Marketing 13(4): 381-405.
Bethwaite, J. & Tompkinson, P. (1996). The ultimatum game and non-selfish utility functions. Journal of Economic Psychology 17(2): 259-271.
Bonetti, S. (1998). Experimental economics and deception. Journal of Economic Psychology 19(3): 377-395.
Brandstatter, H., & Konigstein, M. (2001). Personality influences on ultimatum bargainin decisions. European Journal of Personality 15(1): S53-S70.
Buchan, N.R., Croson, R.T.A., Johnson, E.J., & Iacobucci, D. (2004). When do fair beliefs influence bargaining behavior? Experimental bargaining in Japan and the United States.. Journal of Consumer Research 31(1): 181-190.
Calderon, J.P., & Zarama, Roberto. (2006). How Learning Affects the Evolution of Strong Reciprocity. Adaptive Behavior 14(3):211-221.
Camerer, C.F. (2003). Strategizing in the Brain. Science 300(5626): 1673-1675.
Croson, R., Boles, T., & Murnighan, J.K. (2003). Cheap talk in bargaining experiments: Lying and threats in ultimatum games.. Journal of Economic Behavior & Organization 51(2): 143-159.
Dickenson, D.L. (2000). Ultimatum decision-making: A test of reciprocal kindness. Theory and Decision 48(2): 151-177.
Falk, A. & Fischbacher, U. (2006). A Theory of Reciprocity. Games and Economic Behavior 54(2):293-315.
Fetchenhauer, Detlef & Huang, Xu. Justice sensitivity and distributive decisions in experimental games. Personality and Individual Differences 36(5): 1015-1029.
Gale, J., Binmore, K.G., & Samuelson, L. (1995). Learning to be imperfect: The ultimatum game. Games and Economic Behavior 8(1): 56.90
Gneezy, U., Haruvy, E., & Roth, A.E. (2003). Find More Like ThisBargaining under a deadline: Evidence from the reverse ultimatum game.. Games and Economic Behavior 45(2): 347-368.
Gowdy, J., Iorgulescu, R., & Onyeiwu, S. (2003). Fairness and Retaliation in a Rural Nigerian Village. Social Journal of Economic Behavior & Organization 52(4): 469-479.
Guth, W., Huck, S., & Muller, Wieland. (2001). The Relevance of Equal Splits in Ultimatum Games.. Games and Economic Behavior 37(1): 161-169.
Handgraaf, M.J.J., van Dijk, E., Wilke, H.A.M., & Vermunt, R.C. (2003). The salience of a recipient’s alternatives: Inter- and intrapersonal comparison in ultimatum games. Organizational Behavior and Human Decision PRocesses 90(!): 165-177.
Haselhuhn, M.P., & Mellers, B.A. (2005). Emotions and Cooperation in Economic Games. Cognitive Brain Research 23(1): 24-33.
Henrich, J., et al. (2005). ‘Economic man’ in cross-cultural perspective: Behavioral experiments in 15 small-scale societies.. Behavioral and Brain Sciences 28(6): 795-855.
Hoffmann, , R. & Tee, J. (2006). Adolescent-adult interactions and culture in the ultimatum game.. Journal of Economic Pscyhology 27(1):98-116.
Humphrey, S.E., Ellis, A.P.J., Conlon, D.E., & Tinsley, C.H. (2004). Understanding Customer Reactions to Brokered Ultimatums: Applying Negotiation and Justice Theory. Journal of Applied Psychology 89(3): 466-482.
Kagel, J.H., Kim, C., & Moser, D. (1996). Fairness in ultimatum games with asymmetric information and asymmetric payoffs. Games and Economic Behavior 13(1): 100-110.
Kay, A.C., Wheeler, S.C., Bargh, J.A., & Ross, L. (2004). Material priming: The influence of mundane physical objects on situational construal and competitive behavioral choice. Organizational Behavior and Human Decision Processes 95(1): 83-96.
Ketelaar, T., & Au, W.T. (2003). The effects of feelings of guilt on the behaviour of uncooperative individuals in repeated social bargaining games: An affect-as-information interpretation of the role of emotion in social interaction.. Cognition & Emotion: 17(3): 429-453.
Knez, M.J., & Camerer, C.F. (1995). Outside Options and Social Comparison in Three-Player Ultimatum Game Experiments. Games and Economic Behavior 10(1): 65-94.
Larrick, R.P. & Blount, S. (1997). The claiming effect: Why players are more generous in social dilemmas than in ultimatum games. Journal of Personality and Social Psychology 72(4): 810-825.
Lusk, J.L., & Hudson, D. (2004). Effect of Monitor-Subject Cheap Talk on Ultimatum Game Offers. Journal of Economic Behavior & Organization 54(#): 439-443.
Messick, D.M., Moore, D.A., & Bazerman, M.H. (1997). Ultimatum bargaining with a group: Underestimating the importance of the decision rule. Organizational Behavior and Human Decision Processes 69(2): 87-101.
Munier, B., & Zaharia, C. (2002). High stakes and acceptance behavior in ultimatum bargaining: A contribution from an international experiment.. Theory and Decision 53(3): 187-207.
Napel, S. (2003). Aspiration Adaption in the Ultimatum Game. Games and Economic Behavior 43(1): 86-106.
Nowak, M.A., Page, K.M., & Sigmund, K. (2000). Fairness versus reason in the ultimatum game. Science 289(5485): 1772-1775.
Robert, C. & Carnevale, P.J. (1997). Group choice in ultimatum bargaining. Organizational Behavior and Human Decision Processes 72(2): 256-279.
Ruffle, B.J. (1998). More Is Better, But Fair Is Fair: Tipping in Dictator and Ultimatum Games. Games and Economic Behavior 23(2): 247-265.
Sally, D., & Hill, E. (2006). The development of interpersonal strategy: Autism, theory-of-mind, cooperation and fairness. Journal of Economic Psychology 27(1):73-97.
Solnick, S.J. & Schweitzer, M.E. (1999). The influence of physical attractiveness and gender on ultimatum game decisions. Organizational Behavior and Human Decision Processes 79(3): 199-215.
Suleiman, R. (1996). Expectations and fairness in a modified Ultimatum game. Journal of Economic Psychology 17(5): 1996.
Sulkin, T., & Simon, A.F. (2002). Habermas in the lab: A study of deliberation in an experimental setting.. Political Psychology 22(4): 809-826.
Takezawa, M., Gummerum, Michaela, & Keller, Monika. (2006). A stage for the rational tail of the emotional dog: Roles of moral reasoning in group decision making.. Journal of Economic Psychology 27(1):117-139.
Oppewal, H., & Tougareva, E. (1992). A three-person ultimatum game to investigate effects of differences in need, sharing rules and observability on bargaining behaviour. Experimental Economics 13(2): 203-213.
van Dijk, E. & Vermunt, Riel. (2000). Strategy and fairness in social decision making: Sometimes it pays to be powerless.. Journal of Experimental Psychology 26(1):1-25.
van ‘t Wout, M., Kahn, R.S., Sanfey, A.G., & Aleman, A. (2005). Repetitive transcranial magnetic stimulation over the right dorsolateral prefrontal cortex affects strategic decision-making.. Neuroreport: For Rapid Communication of Neuroscience Research 16(16): 1849-1852.
Weg, E., & Smith, V. (1993). On the failure to induce meager offers in ultimatum games. Journal of Economic Psychology 14(1): 17-32.

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