Fairness is based on quality, not just quantity

Abstract

According to decades of research, whether negotiations succeed depends on how much of the stake each person will get. Yet, real-world stakes often consist of resources that vary on quality, not just quantity. While it may appear obvious that people should reject qualitatively inferior offers, just as they reject quantitatively unequal offers, it is less clear why. Across three incentive-compatible studies (N = 1,303) using the ultimatum game, we evaluate three possible reasons for why people reject qualitatively unequal negotiation offers (that are 50% of the stake): fairness, mere inequality, or badness. Data across the three studies are consistent with the fairness account. Casting doubt on the possibility that people reject qualitatively unequal offers merely because they are ‘bad’, Studies 1 and 2 found that participants were more likely to reject the same coins when these were inferior (e.g., 200 × 5¢ coins) to the negotiation partner’s coins (e.g., 5 × $2 coins) than when both parties received the same undesirable coins (e.g., both received 200 × 5¢ coins). Supporting a fairness explanation, rejection rates of the qualitatively inferior offer were higher when the proposal came from a human (vs. a computer), suggesting that rejection stemmed in part from a desire to punish the negotiation partner for unfair treatment (Study 3). Nevertheless, some participants still rejected the unequal offer from a computer, suggesting that mere inequality matters as well. In sum, the findings highlight that quality, not just quantity, is important for attaining fair negotiation outcomes.