Other Solutions to the Ultimatum Game

This lecture explores other solutions to the ultimatum game. The materials presented here are pretty technical. If you don’t have a bargaining background or would prefer skipping over some math, you can go straight to the next lecture without a problem. But if you are watching this course because you are taking a class on bargaining theory, you definitely need to go through this.

Takeaway Points

  1. When the proposer demands the entire surplus, the receiver is indifferent between accepting and rejecting. As such, she can optimally choose either.
  2. Consequently, there are solutions to the ultimatum game that result in the receiver receiving none of the surplus.


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