ULTIMATUM BARGAINING WITH A GROUP - UNDERESTIMATING THE IMPORTANCE OFTHE DECISION RULE

The three experiments presented here modified the standard ultimatum g ame by having a committee of five people either accept or reject offer s made by one allocator. Although the decision rule the committee used to decide whether to accept or reject the offer had a large effect on the optimal allocation strategy, we hypothesized that allocators woul d have difficulty incorporating the implications of the committee's de cision rule into their allocation decisions. Experiment 1 found subjec ts to be very insensitive to decision rule. In fact, decision rule had no effect on allocation decisions. Experiment 2 made the decision rul e and its implications more obvious to subjects, but allocations still deviated from the strategies that would have maximized winnings. Expe riment 3 provided convincing evidence that the reasons for these devia tions from the maximizing strategy have to do with insensitivity to th e implications of the group's decision rule and with the difficulty in thinking accurately about the cognitions of others. (C) 1997 Academic Press.