Considerations of Fairness and Strategy: Experimental Data from Sequential Games

  title={Considerations of Fairness and Strategy: Experimental Data from Sequential Games},
  author={Vesna Prasnikar and Alvin E. Roth},
  journal={Quarterly Journal of Economics},
Laboratory data from bargaining experiments have started a debate about the prospects for various parts of game theory as descriptive theories of observable behavior, and about whether, to what extent, and how a successful descriptive theory must take into account peoples' perceptions of "fairness." Plausible explanations of the observed bargaining phenomena advanced by different investigators lead to markedly different predictions about what should be observed in three different games. A sharp… 

Figures and Tables from this paper

Expectations and fairness in a simple bargaining experiment

We evaluate two competing hypotheses that try to account for robust violations of the predictions of game theory in Ultimatum bargaining experiments. One popular hypothesis is that the subjects are

An Alternative Approach to Explaining Bargaining Behavior in Simple Sequential Games

For simple sequential games, the payoff structure has certain bargaining power implication. Intuitively, certain actions may have the effect of the carrot and the stick as sanctioning means. Fair

Bargaining and Dilemma Games: From Laboratory Data Towards Theoretical Synthesis

Bargaining and dilemma games have developed in experimental economics as fairly separate literatures. More than a few analysts are now persuaded that the patterns of behavior in these games are

What Makes an Allocation Fair? Some Experimental Evidence

The result suggests that the selfish prediction is prone to deviations when the equilibrium results in unequal distributions of payoffs, and there are alternative outcomes that increase both equality and the payoff of the disadvantaged party.

Game Theory and Fairness Preferences

During the last three decades a lot of attention was given to experimental investigations of the ultimatum game. Contrary to the theoretical “standard” prediction based on maximization of the

Measuring Players' Losses in Experimental Games

In some experiments rational players who understand the structure of the game could improve their payoff. We bound the size of the observed losses in several such experiments. To do this, we suppose

Trading Goods versus Sharing Money - An Experiment Testing Wether Fairness and Efficiency are Frame Dependent

Systematic experiments with distribution games (for a survey, see Roth, 1995) have shown that participants are strongly motivated by fairness and efficiency considerations. This evidence, however,



A Comparative Model of Bargaining: Theory and Evidence

Recent laboratory studies of alternating-offer bargaining find many empirical regularities that are inconsistent with the standard theory. In this paper, the author postulates that bargainers behave

Effects of fixed costs in two-person sequential bargaining

Rubinstein (1982) considered the problem of dividing a given surplus between two players sequentially, and then proposed a model in which the two players alternately make and respond to each other's

A Further Test of Noncooperative Bargaining Theory: Comment

A great deal of attention has recently been devoted to providing noncooperative game theory foundations to bargaining problems, (compare Ingolf Stahl, 1972, and Ariel Rubinstein, 1982). This approach

Bargaining and Market Behavior in Jerusalem, Ljubljana, Pittsburgh, and Tokyo: An Experimental Study

In an experiment comparing two-person bargaining and multiperson markets in Israel, Japan, the United States, and Yugoslavia, market outcomes converged to equilibrium everywhere, with no

An Experimental Evaluation of Weakest Link/Best Shot Models of Public Goods

In the supply of public goods, far less free-riding actually occurs than traditional theory predicts. As one explanation, the social composition function(SCF), which aggregates individual

Ultimatum Bargaining for a Shrinking Cake — An Experimental Analysis —

In an ultimatum bargaining game two players have to divide a given positive amount c of money. First player 1 demands how much of the ‘cake’ c he desires for himself. Then player 2 can either accept