Auctioning the Right to Play Ultimatum Games and the Impact on Equilibrium Selection
AbstractWe auction scarce rights to play the Proposer and Responder positions in ultimatum games. As a control treatment, we randomly allocate these rights and charge exogenous participation fees. These participation fee sequences match the auction price sequence from a session of the original treatment. With endogenous selection via auctions, we find that play converges to a session-specific Nash equilibrium, and auction prices emerge supporting this equilibrium by the principle of forward induction. With random assignment, we find play also converges to a session-specific Nash equilibrium as predicted by the principle of loss avoidance. While Nash equilibria with low offers are observed, the subgame perfect Nash equilibrium never is. View Full-Text
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Shachat, J.; Swarthout, J.T. Auctioning the Right to Play Ultimatum Games and the Impact on Equilibrium Selection. Games 2013, 4, 738-753.
Shachat J, Swarthout JT. Auctioning the Right to Play Ultimatum Games and the Impact on Equilibrium Selection. Games. 2013; 4(4):738-753.Chicago/Turabian Style
Shachat, Jason; Swarthout, J. T. 2013. "Auctioning the Right to Play Ultimatum Games and the Impact on Equilibrium Selection." Games 4, no. 4: 738-753.