The Role of Morals in Three-Player Ultimatum Games

Abstract

We experimentally investigate the role of moral concerns in three-player ultimatum bargaining. In our experimental paradigm, proposers can increase the overall size of the pie at the expenses of an NGO that conducts humanitarian aid in emergency areas. In a first study, we find that responders are not willing to engage in ‘immoral’ transactions only when fully informed about proposers’ behavior toward the NGO. Under complete information, their willingness to reject offers increases with the strength of the harm to the NGO. Moreover, the possibility to compensate the NGO through rejection further increases their willingness to reject. In a second study aimed at gauging the importance of different motives behind rejections, we show that the two most prevalent motives are to compensate the NGO or to diminish inequality between responders and proposers. Punishing proposers’ unkind intentions towards the NGO or rejecting on the basis of pure deontological reasons constitute less important motives.

Keywords: mini ultimatum game, morals, experiment

JEL Classification: C72, C91, D6