In this experiment there will be a total of 20 participants.
Half of the people in this experiment will play the role of Proposers and the other half will be Responders. At the end of the instructions you will find out which role you are assigned. Your role will be the same throughout the experiment.
EOF Each day in the experiment you will make a new decision that will determine the division of 100 tokens between Proposers and Responders. The money you earn will depend on how many tokens you accumulate compared to the other subjects of your same role.
Your earnings each round will accumulate toward your total monetary payoff. The experiment lasts for ten days, and one round is played each day.
Next we describe the decisions both the Proposers and Responders must make. Pay close attention to what both players must choose, since you will need to understand both roles in order to make good decisions.
Proposers will propose a split of 100 tokens. The Responder will either accept or reject the proposal. If the proposal is rejected, both participants earn no tokens.
The Proposer's decision page looks like this:
Proposer's Decision:Divide 100 tokens.
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The Proposers must select a number between 0 and 100 to pass to the Responders. They must do this without knowing what the Responders have decided.
The Responder's decision page looks like this:
Responder's Decision: |
As you can see, the Responders will not necessarily accept all proposals made by the Proposer. Here are a couple of examples to help understand how payoffs are calculated:
Proposer's Decision:Divide 100 tokens.
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At the same time, the Responder enters this decision:
Responder's Decision: |
Since 67 is greater than 6, the offer is accepted and the Proposer gets 33 tokens and the Responder gets 67.
Proposer's Decision:Divide 100 tokens.
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At the same time, the Responder enters this decision:
Responder's Decision: |
Since 8 is less than 55, the offer is rejected and both participants get no tokens.
For instance, suppose there are three Proposers and three Responders. Let's show how Proposer A's earning are calculated. Suppose Proposer A decides to hold 33 and pass 67, as in Example 1 above. Suppose that this is acceptable to 2 of the Responders, but not to a third. Then person A accumulates an average of (33 + 33 + 0)/3 = 66/3 = 22. We would then put 22 tokens into person A's Token Account.
Suppose Responder B decided to accept all offers that passed at least 27 to him. Suppose the three Proposers proposed to pass 54, 42, and 21. Then Responder B would accept two of these and reject one, and as a result would earn an average of (54 + 42 + 0)/3 = 96/3=32. We would then put 32 tokens into person B's Token Account.
NOTE: In this experiment there are 10 Proposers and 10 Responders, so you will be matched with all 10 of the other role.
| Amount of cash deposited into the Cash Account |
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| Person with the 1st most Tokens earned this decision round | $5.00 |
| Person with the 2nd most Tokens earned this decision round | $4.25 |
| Person with the 3rd most Tokens earned this decision round | $3.50 |
| Person with the 4th most Tokens earned this decision round | $3.00 |
| Person with the 5th most Tokens earned this decision round | $2.50 |
| Person with the 6th most Tokens earned this decision round | $2.00 |
| Person with the 7th most Tokens earned this decision round | $1.50 |
| Person with the 8th most Tokens earned this decision round | $1.00 |
| Person with the 9th most Tokens earned this decision round | $0.50 |
| Person with the 10th most Tokens earned this decision round | $0.00 |
For example, the Proposer with the most tokens in round 1 will earn $5.00. The Proposer with the 2nd most tokens in round 1 will earn $4.25. The Proposer with the third most will earn $3.50, and so on. Likewise, the Responder with the most tokens in round 1 will earn $5.00. The Responder with the 2nd most tokens in round 1 will earn $4.25. The Responder with the third most will earn $3.50, and so on. Hence, Proposers are compared to Proposers, and Responders are compared to Responders. We repeat this process each round.
If two or more players earn the same amount of tokens in a given round, they will split the payoffs in the table below. For instance, if two people tie for 4th, each will earn (3.00+2.50)/2 = $2.75.
At the end of the experiment the total cash in your cash account will be sent to you by check to the address you gave at registration.
You must log in every day to enter a decision, even if your decision does not change!
So, every time you forget to enter a decision, your final earnings will be reduced by 5.00.
Most important, no one in the experiment will be able to identify you during or after the experiment.
This concludes the instructions. You may review them any time during the experiment simply by clicking on INSTRUCTIONS.
Now you may find out your role, either Proposer or Responder, by clicking here: YOUR ROLE