You are the second player in the Ultimatum Game. What will you accept?

[The_Hamster_King]

@Gus_Gusterson

I would take $1 if that was the offer. That’s $1 more than I had before the experiment. You don’t get rich by refusing to accept money.

But you DO get rich by making the other guy THINK you’ll refuse to accept money.

Let’s turn the question around. If you were the person picking how the money was to be divvied up, would you think “Everyone who plays this game will be completely rational in their choices, so offering the other guy $1 is a great strategy!”

Or would you think “The best way for me to get some money out of this deal is to pick a value high enough that the other guy is unlikely to be insulted.”

The threat of irrational behavior is a powerful negotiating tool.

[DrDeth]

@Gus_Gusterson

@DrDeth

See, if the other guy KNOWS that the average person will hold out for a reasonable amount, he will offer more, thus in the long run, it’s a WIN for people to hold out. Besides, my time is worth more than a dollar.

First, there’s no “holding out”. You either choose to take the offer or you choose to reject it. The experiment is over at that point.

Second, your time is already spent in this scenario, so refusing the offer makes no sense from that standpoint.

I would take $1 if that was the offer. That’s $1 more than I had before the experiment. You don’t get rich by refusing to accept money.

Sure, that one segment of that experiment is over. But if the word gets out (and it will) then it benefits all to hold out.

The enjoyment I’d get by seeing the greedy SOB not getting a cent would be worth far more than the $1.

The whole point is that as humans, we need to cooperate as part of a social contract. Cooperation means making reasonable offers to others, so we ALL get more. If either side gets greedy, no one gets anything.

Besides, look at it another way- the offer-er knows that by offering less, his chances of getting nothing have radically increased. Why should he give it all up for another few bucks?