The indirect evolutionary approach to explaining fair allocations

Experimental results on the ultimatum game show clearly that (1) large frac tions of players offer a "fair" allocation and (2) that unfair (but positiv e) offers are systematically rejected. We offer an explanation of this beha vior using the "indirect evolutionary approach" which is based on the assum ption that players behave rationally for given preferences but that their p references change through an evolutionary process. We prove that despite an onymous interaction a preference for punishing unfair offers is an evolutio narily successful strategy if players interact in small groups. This leads players to split the: resource equally almost always. However, the equal sp lit is not due to "true fairness" (or "altruism") but is entirely caused by the (justified) fear that unfair offers might be rejected. (C) 1999 Academ ic Press.