Sunday, March 9, 2014

A Possible Beginning 


.Let’s say you and I are walking down a city street when a woman approaches you with a handful of ten dollar bills. She tells you that you can keep some of the money as long as you offer some to me and I accept it. The amount you offer me is up to you but if I don’t accept what you offer, then neither of us gets to keep any of the money.  When you offer me a 60-40 spilt I feel a strong sense of unfairness, so I refuse. The woman walks away with the money.

This scenario, also called the Ultimatum game, is an economic experiment. It led to the discovers of inequity aversion. Even primates demonstrate something resembling inequity aversion. Researchers experimented with brown capuchin monkeys. They would ask the trained monkeys to perform certain tasks and the monkeys, after observing a companion of similar social rank receive a juicy grape for  performing the same task, would become uncooperative if offered a cucumber.

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