Procedural justice in bargaining games

Abstract

I consider several variants of dictator and ultimatum games in which the proposer not only offers an allocation of funds but also selects the rules that will govern that distribution. In the dictator/ultimatum choice game, the proposer first selects whether or not the receiver will have the power to reject the offer. Effectively, the proposer decides between playing a dictator and an ultimatum game. Whether a player is self-regarding or motivated by distributive concerns, the player should elect the dictator game as it enables full control over the allocation. Yet, a majority of subjects select the ultimatum game. Further, even those selecting the dictator game make substantially higher offers than those in a control dictator experiment. Additional experiments and surveys explore various explanations for these results. The additional experiments suggest that players' willingness to share decision-making power with other players is quite robust. I conclude that subjects have an innate preference for "voice," a key component of procedural justice.