The Ultimatum Game

I mentioned that there would be cases when people would answer the question “Do you want $2 or $0?” with “$0”. This is what actually happens in the Ultimatum Game, described here, with references. The basic idea is that there are two players, asked to split up a pot of money, say $10. The first player gets to decide an appropriate split between the two players. The second player is given the option of accepting the split as offered, or rejecting the split, in which case neither player gets anything. In the isolated case of “Do you want $2 or $0?”, a responder would almost always take $2. But if the responder is playing the Ultimatum Game, and they know that when they’re getting $2, the first player is getting $8, half of all respondents reject the $2 and take nothing.

This is a fascinating result to me. It demonstrates the all-encompassing importance of context. In an isolated context, people answer one way. In a social context, they answer differently, where feelings of fairness are brought into play. In fact, one study used MRI scanning to demonstrate that unfair offers activated a part of the brain that is associated with negative emotions, including, one would assume, spite. The paper goes on to point out that the MRI results demonstrated a conflict between “the emotional goal of resisting unfairness and the cognitive goal of accumulating money.”

One might wonder where humans have learned what “fairness” is, and why it is built into our brain chemistry. This paper gives some insight into how such an instinct evolved. In it, they run computer simulations and demonstrate that the fairness instinct can evolve in the Ultimatum Game if participants are given a history. If it were a one-off game, the first player would always make the split uneven, and the second player would decide that something is better than nothing. However, if there are repeated iterations, the second player can spite the first player by holding out for a “fair” split, and enhance the likelihood of getting a better deal in the future. In other words, fairness only matters when you are likely to interact with the same people repeatedly – “When reputation is included in the Ultimatum Game, adaptation favors fairness over reason. In this most elementary game, information on the co-player fosters the emergence of strategies that are nonrational, but promote economic exchange.” And the MRI studies demonstrate that such strategies, such feelings of fairness, are actually built into our brain chemistry.

This leads to an important result in my mind. Because we are primates, and prisoners of the monkeymind, things like fairness and social justice only matter when we are dealing with those within our monkeyverse. If we are dealing with people within our social universe, people who we are likely to run into again, even if they are only Familiar Strangers. We don’t rip off the guy at the corner convenience store because we stop in there regularly. We pay our fair share at dinners with our friends because we know we will be going out to dinner with them again.

However, if we are dealing with strangers, with people we don’t feel are part of our world, and with whom we will not have to interact with again, then all the rules of fairness go out the window. We are returned to pure self-interest. It’s like a one-off game of the Ultimatum Game. We feel fine cheating the people we don’t know, because in an emotional sense, they aren’t people to us. They don’t evoke our rules of fairness. They are objects in the world, to be used and disposed of.

How do we expand our monkeyverses, keeping us from doing stupid things like stealing from strangers, committing hate crimes, and invading foreign countries? My answer is probably not surprising: we use stories as a way of giving us the details about other people that change them from cardboard cutouts into people. By turning them into real three-dimensional people, stories can activate our monkeybrain and all of the accompanying emotions of fairness and guilt. Such emotions leverage the way our social brains have evolved, hopefully getting us to treat each other better. It’s a theory. And one I’ll probably return to at some point.