The Influence of Counterfactual Comparison on Fairness in Gain-Loss Contexts.

Qi Li,Xun Liu,Chunsheng Wang,Zhong Yang,Ya Zheng,Jamie Taxer

doi:10.3389/fpsyg.2017.00683

Abstract

Fairness perceptions may be affected by counterfactual comparisons. Although certain studies using a two-player ultimatum game (UG) have shown that comparison with the proposers influences the responders' fairness perceptions in a gain context, the effect of counterfactual comparison in a UG with multiple responders or proposers remains unclear, especially in a loss context. To resolve these issues, this study used a modified three-player UG with multiple responders in Experiment 1 and multiple proposers in Experiment 2 to examine the influence of counterfactual comparison on fairness-related decision-making in gain and loss contexts. The two experiments consistently showed that regardless of the gain or loss context, the level of inequality of the offer and counterfactual comparison influenced acceptance rates (ARs), response times (RTs), and fairness ratings (FRs). If the offers that were received were better than the counterfactual offers, unequal offers were more likely to be accepted than equal offers, and participants were more likely to report higher FRs and to make decisions more quickly. In contrast, when the offers they received were worse than the counterfactual offers, participants were more likely to reject unequal offers than equal offers, reported lower FRs, and made decisions more slowly. These results demonstrate that responders' fairness perceptions are influenced by not only comparisons of the absolute amount of money that they would receive but also specific counterfactuals from other proposers or responders. These findings improve our understanding of fairness perceptions.

Highlights

Individuals often reject an unequal distribution even at a cost to themselves
A series of 2 × 4 × 2 repeated-measure ANOVAs were conducted on the acceptance rates (ARs), response times (RTs), and fairness ratings (FRs)
Consistent with previous multiple-person ultimatum game (UG) studies in which the allocation of a third player with decision power (Knez and Camerer, 1995; Du et al, 2013; Zheng et al, 2015) or an average amount (Bohnet and Zeckhauser, 2004; Wu et al, 2011) were presented, our research showed that people were less likely to accept an unequal offer if it left them with a more inequitable payoff relative to their peers, and they demanded less when they knew that their peers were offered less regardless of the gain or loss contexts

Summary

Introduction

Individuals often reject an unequal distribution even at a cost to themselves. This phenomenon has been examined using the ultimatum game (UG) (Sanfey et al, 2003; Tabibnia et al, 2008; Dulebohn et al, 2009; Güroglu et al, 2010, 2011). In this game, two players divide a sum of money. The second player, the responder, accepts or rejects the proposed division. Standard economic models predict that the responder makes the rational decision to maximize his/her benefits and that

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Conclusion