Irrelevant Advantages: Children Think Responders Will Costly Punish Unequal Offers Regardless of Outside Options

• In Event: Beyond Punishment: How Do Children Respond to Moral Transgressions?

Abstract

We often rely on bargaining as a way of achieving fair outcomes, both in purely economic transactions such as negotiating a salary or buying a house, and non-economic transactions such as deciding who is responsible for doing the dishes. Prior work using the paradigm of bargaining games—specifically ultimatum games—has demonstrated how adults take fairness into account both when proposing and accepting offers in a bargain, and are furthermore willing to incur a cost to punish inequitable offers. (Güth & Kocher, 2014). However, adults’ willingness to punish moral transgressors also takes into account one person’s advantage over another (Schmitt, 2004; Hennig-Schmidt, 2018). In ultimatum games, these advantages can take the form of outside options: opportunities that one or both participants can access when bargaining breaks down. For example, major corporations may successfully leverage the lack of worker protections to avoid the punishment of minimum wage employees quitting. Although adults take asymmetric outside options into consideration, whether children exhibit the same patterns of behavior remains an open question.
Prior work examining children’s behavior on simple ultimatum games has found that older children, aged 8 years and older, behave similarly to adults and engage in strategic behavior (Steinbeis et al., 2012; Güroglu et al., 2009). These results indicate that older children may be more successful at considering outside options when predicting bargaining behavior. By examining children’s predictions of costly punishment in the presence of outside options, we hope to contribute another piece of the puzzle in understanding how children transition from equality-preference to a more complex model of fairness.
The present research therefore aims to investigate children’s developing understanding of fairness by examining whether children’s costly punishment differs in the presence and absence of asymmetric outside options. Across two studies, 299 adults and 60 children (aged 8-12 years) were presented with a child-friendly version of the ultimatum games including different types of outside options (low or high advantage), as well as different types of offers proposed (ranging from equal to completely selfish), and asked to make third-party predictions for the outcome of responder’s behavior in each trial. Our results demonstrated that adults—but not children—take outside options into account when predicting responses to offers. Specifically, as the proposer’s outside options increased from low to high advantage, participants expected that responders would be more likely to accept selfish offers, and less likely to engage in costly punishment. While children expected selfish offers to be punished more frequently, the inclusion of outside options did not decrease predictions of costly punishment. These results indicate that adults expect others to be able to leverage their asymmetric advantage to obtain a better bargain, but children ignore these advantages in favor of punishing transgressors based purely on the bargain itself. As older children have previously been able to engage in strategic behavior in the case of mini-ultimatum games, rather than fixating on the equality of the bargain, it is more likely that they have not yet developed the ability to grasp the role of these outside options as potential leverage.

Authors

• Sifana Sohail, Yale University
  Presenting Author

• Yarrow C Dunham, Yale University