Author Question: People are sometimes seen to give up money to make an allocation more fair. What experiment could be ... (Read 114 times)

urbanoutfitters · **on:** Jul 1, 2018

People are sometimes seen to give up money to make an allocation more fair. What experiment could be used to determine if this is because people truly care about fairness or because people want to avoid the consequences of others' spite?
a. The Ultimatum Game could be run to see if an even split is proposed.
b. The Dictator Game could be run to see if an even split is proposed.
c. The Battle of the Sexes could be run to see if players choose the rival's preferred outcome.
d. The repeated Prisoners Dilemma could be run to see if players can tacitly collude on Silent.

Question 2

Consider the same ultimatum game as in the previous questions but consider yet new preferences reflecting envy. In particular, now assume players get 1 util per dollar earned. That is all for the player who earns at least as much as the other. The player who earns strictly less than the other loses 1 util for each dollar difference. Which of the following is an offer that arises in a subgame-perfect equilibrium with these preferences?
a. 1.
b. 2.
c. 4.
d. 5.