Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/127281
Authors: 
Oechssler, Jörg
Roider, Andreas
Schmitz, Patrick W.
Year of Publication: 
2009
Series/Report no.: 
Discussion Paper Series, University of Heidelberg, Department of Economics 463
Abstract: 
Negotiations frequently end in conflict after one party rejects a final offer. In a large-scale internet experiment, we investigate whether a 24-hour cooling-off period leads to fewer rejections in ultimatum bargaining. We conduct a standard cash treatment and a lottery treatment, where subjects receive lottery tickets for several large prizes - emulating a high-stakes environment. In the lottery treatment, unfair offers are less frequently rejected, and cooling-off significantly reduces the rejection rate further. In the cash treatment, rejections are more frequent and remain so after cooling-off. This treatment difference is particularly pronounced for subjects with lower cognitive abilities.
Subjects: 
negotiations
ultimatum game
emotions
cooling-off
cognitive abilities
behavioral biases
internet experiment
JEL: 
C78
C99
D8
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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