Ultimatum bargaining: From synapse to society Colin F. Camerer, Caltech

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Ultimatum bargaining From synapse to
societyColin F. Camerer, Caltech

• Ultimatum game
• Proposer offers division of 10 responder
  accepts or rejects
• Theories
• Rejections express social preferences (care about
  , envy, guilt)
• Unnatural habitat (adapted to repeated games,
  one-shot is Stroop)
• Variants
• Dictator games (same responsibility?)
• Demographics (generally weak)
• Stakes rejected goes up, goes down
• Repetition etc. weak
• Low information about pie size? lower offers
  (and pleading poverty )
• Proposer competition? offers give most to
  responder
• Two-stage games? responders (weakly) accept lower
  offers because proposers have an excuse
  (intentions matter)

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Game-ending ultimatum rejections are like
disadvantageous counterproposals in longer games
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US data (Roth et al 1991)
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Ultimatum vs dictator games (Forsythe et al
1994) NB Dictator games are weak situations,
more variance
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Low, medium, high stakes (Slonim-Roth 1998)
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Do players learn to accept low offers at high
stakes?
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Special subject pools conditions

• Neural evidence (ACC, DLPFC, insula for low
  offers difference predicts rejection r.4)
• Autistics offer less (dont expect rejection)
• Adults learn to take objective stance
• Cutting-off-nose effect (Monkeys reject unequal
  pay, Brosnan and De Waal, Science 9/18/03 F
  capuchins will refuse exchange for low payoff if
  others get high payoff)
• Small-scale societies
• Variation in mean offer (some offer very little)
• Fair offers correlated with market integration
  and cooperativeness

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Market games (9-proposer competition)
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Intentions matter (Falk et al 99) (cf. law e.g.
manslaughter vs murder)
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Sanfey et al fMRI study (Sci 13 March 03)
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ask the brain within (L) and pooled (R)
correlations of insula and DLPFC activity
rejection
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Feeling This is your brain on unfairness
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Pain circuitry
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Ultimatum offer experimental sites
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The Machiguenga independent families cash
cropping
slash burn gathered foods fishing hunting
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African pastoralists (Kenya)
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Whale Hunters of Lamalera, Indonesia
High levels of cooperation among hunters of
whales, sharks, dolphins and rays. Protein for
carbs trade with inlanders
Researcher Mike Alvard
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Ultimatum offers across societies (mean shaded,
mode is largest circle)
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Fair offers correlate with market integration
(top), cooperativeness in everyday life (bottom)
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Ultimatum offers of children who failed/passed
false belief test
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Autistics v normals (adults top, children bottom)
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Israeli subject (autistic?) complaining
post-experiment (Zamir, 2000)
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Unnatural habit hypothesis

• "Although subjects fully understand the rules of
  the game and its payoff structure, their behavior
  is influenced by an unconscious perception that
  the situation they are facing is part of a much
  more extended game of similar real-life
  interactionsWe believe that it is practically
  impossible to create laboratory conditions that
  would cancel out this effect and induce subjects
  to act as if they were facing an anonymous
  one-shot ultimatum game." (Winter Zamir,
  1997)

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Testing theories New ideas

• How to separate preference vs unnatural habitat
  views?
• Role of emotions
• Look for cross-game regularity in measured
  preferences
• Learning (or is it temporary satiation?)
• fMRI and ACC Stroop interpretations