Suppose Justine and Sarah are playing the ultimatum game. Justine is the proposer, has $30 to allocate, and Sarah can accept or reject the offer. Based on repeated experiments of the ultimatum game, what combination of payouts to Justine and Sarah is most likely to occur?

Question

Quizplus · Accepted Answer

Repeated experiments of the ultimatum game show that proposers tend to offer a fair or nearly fair split, anticipating that offers perceived as unfair are likely to be rejected. Thus, a split of $16 for Justine and $14 for Sarah is most likely, as it is close to an even distribution and is likely to be accepted by Sarah.

Suppose Justine and Sarah Are Playing the Ultimatum Game