$100 to me, $0 to player B
$99 to me, $1 to player B
$90 to me, $10 to player B
$80 to me, $20 to player B
$70 to me, $30 to player B
$60 to me, $40 to player B
$50 to me, $50 to player B
$40 to me, $60 to player B
$30 to me, $70 to player B
$20 or less to me, $80 or more to player B
Last edited by fredmertz; 06-14-10 at 12:46 PM.
For me, there is no way that I would agree to 100/0 split unless I really believed that you might need the money more than me. Without actually knowing the person personally, anything but a 50/50 split would be rewarding greed and unfairness, and I would disagree to it on principle. I think the more uneven the money ratio is, the more likely you are to not get anything. So if you consider statistics in this, you would be most likely to make the most money (especially if you played this game often enough from either side) by always offering, and only accepting a 50/50 split (if you had little idea of when the game would actually end).
"A woman is like a teabag, you never know how strong she is until she gets in hot water." - Eleanor Roosevelt
Keep your religion out of other people's marriages.
Looking at this, if I were player A I'd assume a 50/50 split would be accepted 100%. So that makes a fifty dollar gain my baseline. Anything I propose greater in my favor, I jeopardize the guaranteed 50 bucks. So the question would be how much do increase the risk of losing everything vs the potential gains. Let's say if I just tweaked the split to 51/49. I'd say you'd still get at least 90% chance of it being accepted. But is the 10% chance of losing a guaranteed 50 bucks worth the potential gain of a dollar? Math says now 50 x 100 = 500 vs 51 x 90 = 459. And I expect that trend would continue. For each increase in potential gain, you'd disproportionally increase the risk for a total loss. So a 50/50 split is likely to best choice for maximizing my gains.
Now, I believe the formula changes as we increase the total sum in question. Its easy for us as player B to reject 50 bucks or less based on a sense of fairness or personal pride. It's a small amount of money that has no impact on our overall financial status. Change the overall amount from $100 to $10,000 and now it becomes a different game. 60/40 split against Player B still gives him 4 grand. Its a lot harder to turn your back on 4K just because the other guy is getting more. And I believe the more you increase the amount, the greater disparities in the split Player B would be likely to accept. If the overall sum was a 100 million, and I as player B was offered only one million, I'd still take it. As I believe most people would.
Slipping into madness is good for the sake of comparison - Unknown.
There can be value in something without human psychology being a factor. It can be caused by human biology, for example.
99 items of food > than 1 item of food > 0 items of food. Psychology does not have any bearing on that. Psychology would only come into play if the food was liked or not, thus altering the biological value by incorporating the psychological devaluation.
99 bullets in the chest < 1 bullet in the chest < 0 bullets in the chest. Again, Psychology isn't a factor. Psychology would only be a factor if one was suicidal and wanted to reject biological imperatives.
These examples do not incorporate human psychology, but it also shows that value can be assessed without psychology being involved.
Last edited by Tucker Case; 06-14-10 at 01:03 PM.
Tucker Case - Tard magnet.
One other wrinkle that might be worth considering - the setting in which the decision takes place.
I participated in studies like this all the time in undergrad in order to make some money, and the first time I ever had this scenario, my counterpart (who I never met) and I were seated at computers in different rooms. I suspect it was easier to play hardball (and to screw over the other party) when you weren't face to face.
People sleep peaceably in their beds at night only because rough men stand ready to do violence on their behalf.
99/1 if both A and B's goal is to make as much money for themselves in that one game. I'd split it 50/50 in real life.
But in any case, it isn't a trap. This scenario doesn't render any below-the-belt punches or strawmen attacks on any particular economic philosophy. I think that it does highlight why the idea of a perfectly efficient market isn't realistic...and naturally, exposes flaws in the economic ideologies that derive from that. Yes, the idea that markets aren't efficient turns a few of the more extreme libertarian philosophies (like anarcho-capitalism) on their heads...but it also means that the three mainstream philosophies of the late 20th century (monetarism, Keynesianism, and supply-side economics) need to be rethought as well, since they are all based in part on the incorrect premise that markets are efficient.
Last edited by Kandahar; 06-14-10 at 03:07 PM.
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I can't. This is important.
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