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American Economic Review Vol. 105 No. 5 2015

Standing United or Falling Divided? High Stakes Bargaining in a TV Game Show

Dennie van Dolder1; Martijn J. van den Assem2; Colin F. Camerer3; Richard H. Thaler4

1 Nottingham School of Economics, University of Nottingham, University Park, Nottingham, NG7 2RD (e-mail: ) · 2 Faculty of Economics and Business Administration, VU University Amsterdam, De Boelelaan 1105, 1081 HV Amsterdam (e-mail: ) · 3 Division of the Humanities and Social Sciences, California Institute of Technology, 1200 East California Boulevard, Pasadena, CA 91125 (e-mail: ) · 4 Booth School of Business, University of Chicago, 5807 South Woodlawn Avenue, Chicago, IL 60637 (e-mail: )

Abstract

We examine high stakes three-person bargaining in a game show where contestants bargain over a large money amount that is split into three unequal shares. We find that individual behavior and outcomes are strongly influenced by equity concerns: those who contributed more to the jackpot claim larger shares, are less likely to make concessions, and take home larger amounts. Contestants who announce that they will not back down do well relative to others, but they do not secure larger absolute amounts and they harm others. There is no evidence of a first-mover advantage and little evidence that demographic characteristics matter.

DOI
10.1257/aer.p20151017
Volume
105
Issue
5
Pages
402-407
Language
en
Sources
bibtex:phds-export.bib openalex crossref

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