Thinking and Deciding

420 FAIRNESS AND JUSTICE
subject had two options: She could allocate $5 to herself, $5 to E, and nothing to U,
or she could allocate $6 to herself, nothing to E, and $6 to U. The question here was
whether the subject would sacrifice $1 of her own money in order to punish another
subject who had been unfair and reward another subject who had been fair. Out of
the whole group of subjects, 74% chose to make this sacrifice (81% of those who
had themselves chosen equality in the first part, but only 31% of those who chose
inequality).
In sum, subjects are, once again, willing to sacrifice their narrow self-interest
for the sake of fairness, but this sort of fairness involved reward for prior fairness
and punishment for prior unfairness. We could say that the subjects who do this get
more utility from punishing unfairness than from receiving an additional dollar, so
they are selfish after all. But this sort of utility depends on a commitment to a moral
principle. The important point is that they follow this principle, even when their
behavior otherwise reduces their utility.
Another case in which subjects sacrifice narrow self-interest in order to punish
unfairness is the ultimatum game. Suppose you are told that you and a student in a
different class have a chance to divide up $10. The other student, the offerer, will
offer you some part of the $10. If you, the receiver, accept the offer, you will get
the amount offered, and the offerer will get the rest. If you reject the offer, you will
each get nothing. Would you accept an offer of $5? $2? 1 cent? Offers much below
$5 are often rejected. The receiver prefers to see both subjects get nothing rather
than tolerate such unfairness. The receiver therefore is willing to sacrifice in order
to punish unfairness. (This is the negative side of fairness motivation, the desire to
hurt others, even at one’s own expense, in order to restore equality.) Notice that if
receivers were concerned only with their self-interest, they would accept an offer of
1 cent, and the offerers, knowing that, would offer only 1 cent. Most offerers offer
$5, or only a little less — perhaps out of a desire for fairness, perhaps out of fear of
rejection, perhaps for both reasons (Thaler, 1988).
Notice that the receiver is following a principle of equal division (when there is
no reason for unequal division). This principle normally helps to maximize utility,
because of the principle of declining marginal utility (Chapter 10): The total utility of
$5 for each person is higher than the utility of $8 for one and $2 for the other (other
things being equal). In this case, however, the principle fails to maximize utility
when the offer is rejected. Both players would be better off (in terms of narrow
self-interest) if even a low offer were accepted.
When others cannot be given their due, people often change their perception of
the situation. Students who watched another student receive electric shocks when
trying to learn nonsense syllables tended to give that student low ratings on social
attractiveness (Lerner and Simmons, 1966). The ratings were not low when the subjects
thought they could ensure that the learner would be placed in a second condition
in which she would be rewarded instead of shocked. Thus, the subjects “derogated
the victim” only when they could not restore equity themselves. Lerner and Simmons
suggest that we desire to believe that the world is orderly and fair, lest we fear
that we ourselves will become victims of unfairness. This “just world” hypothesis