Modeling Fairness in the Ultimatum Game

Kevin DastalfoAdvisors: Andrew Belmonte and Chris Griffin

Introduction

• Evolutionary Game Theory – What is it?

• The Ultimatum Game• Sub-game perfect equilibrium

• Factors to explore• Altruistic punishment• Expectations• Complacency with status quo• Envy

Goals

1. What modeling has been done? What do previous studies tell us?

2. Assemble, summarize, and formulate conclusions from sets of data

3. Design an ODE; formulate an approach to modeling

Literature Review• Economic Decision-Making in the Ultimatum Game• Neural activity in proposals and acceptance• Role of emotions in decision making• Human vs. Computer

G. Sanfey, J. K. Rilling, J. A. Aronson, L. E. Nystrom, and J. D. Cohen. The neural basis of economic decision-making in the ultimatum game. Science, 300:1755–1758, 2003.

• Learning to be Imperfect• Learning – understanding of optimality• Perturbations in the learning process

J. Gale, K. G. Binmore, and L. Samuelson. Learning to be imperfect: The ultimatum game. Games Econ. Behav., 8:56–90, 1995.

Future Directions

• Formulation of an ODE

• Perform an experiment on campus

• Analyze data and develop conclusions