I was interested in the ultimatum game discussed in class, so I did a literature search through “psych info” to find out more about the psychology behind this game. I game across a 2005 article by Heinz-Deiter Meyer in the journal of economic psychology entitled “Norms and self-interest in ultimatum bargaining: The prince’s prudence”(link below). The article discussed individual differences that were connected to either accepting unfair deals (to them) or rejecting them.

One way people differ is on how “Machiavellian” they are. People who are high for Machiavellianism (“high-machs”) are better (and more willing) at lying and believe that the ends justify the means. “Low-machs” on the other hand tend to act morally, believe that honesty is the best policy, and that people are basically good. This difference is measured using the Mach IV scale.

The article found that for one-shot ultimatum games, high-machs were much more likely to accept unfair deals than low-machs. The reason for this finding (according to the researcher) is that while low-machs are highly concerned with fairness, high-machs are more concerned with self-interest. Consequently, high-machs accept more unfair deals in the ultimatum game than low-machs because they are more interested in themselves than in fairness. In a second experiment, the game was changed from a single-shot game to a multishot game. What was interesting about the multishot game is that while both moderately-high and moderately-low machs were continually exploited, the very-high and very-low machs were effective at countering exploitative deals. For the low-machs, the explanation is the same: they were motivated by goals of equality, and as such rejected bad offers. For high-machs, it is in their own self-interest to reject bad deals, so that they can signal that they will only accept fair offers.

This is interesting because in class we discussed how individuals engage in these exchange games as if everyone behaved in the same way. This study shows that different people, motivated by differing goals, will play the game differently. It is especially interesting to consider the role of high-machs in bargaining games. It has been shown in earlier articles that for games in which there are three people, all connected by an edge, high-machs on average come away with more than 50% of the earnings. The models we use assume that everyone is a high-mach (and as such should be motivated purely by self-interest), however, while some people are motivated by self-interest many are driven by goals of fairness and equality (the low-machs). This individual difference variable may help us account for some discrepancies we encounter when modeling network exchange theory.

Article: http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6V8H-45D0NT5-1C&_user=492137&_rdoc=1&_fmt=&_orig=search&_sort=d&view=c&_acct=C000022719&_version=1&_urlVersion=0&_userid=492137&md5=9e806561bfe467ff41e5ead766bbf204