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10 29 2013 Chapter 7 into 8 Ultimatum Game The Set up Players there is a proposer and a responder The proposer is given a divisible pie money Subjects play anonymously The Procedure Step 1 The proposer offers some of the pie to the responder Step 2 The responder knowing the offer and size of the pie has to accept or reject the offer The Outcome If the responder accepts she gets to keep the offer and the proposer keeps the rest If the responder rejects then neither player receives anything Dictator Game The Dictator Game is exactly the same as the Ultimatum Game except that the responder is not given an opportunity to accept or reject the offer The proposer dictator merely dictates the division Test of fairness as opposed to the ultimatum game Anonymity means no chance of social repercussions Ultimatum Game If the players are self interested we would expect the proposer to offer where is close to zero and keep the rest 1 for himself We would expect the responder to accept this offer because 0 E is better than nothing You know that you will get nothing otherwise Dictator Game If the players are self interested we would expect the proposer to offer zero and keep everything for himself Because nothing gon happen These games have been played in numerous experimental settings using students in virtually all of the industrialized democracies of the world Proposers nearly always make positive offers Responders reject a lot of positive offers especially if they are low 20 Players seem to care about fairness This isn t like the prediction is it a pattern does it have to do with culture Payoffs to cooperation Machiguenga and Tsimane were lowest Lamelara were ranked highest Collaborate with Indonesians Market integration Hadza were ranked lowest don t work together independent Orma were ranked highest Buy and sell livestock Higher market integration and payoffs to cooperation led to higher mean offers If you work with someone and depend on them you will try to make them happy you offer more Account for 66 percent of variance When faced with novel situation they look for analogs in their daily experience saying what familiar situation is this like and then they act in a way appropriate for analogous situation Culture is perhaps a shared way of playing games Life is made up of lots of strategic situations and our culture affects how we play in these games Democracy game Some countries find it easier to support democracy than others because the individuals in those countries will have analogous games in their everyday lives that make it beneficial and easier for them to play the democracy game Culture a shared way of playing games may well affect the emergence and survival of democracy Reading Stats Table Top line dependant Left column independent explanatory Positive coefficient indicates that the variable increases probability that a democracy will emerge means statistical evidence Standard errors are how data is distributed around that coefficient larger standard error larger space from line Chapter 8 Democratic Transitions Since 1992 Democracies exceed Dictatorships 10 29 2013 Third wave of democratization 1974 onward surge External 2003 Iraq make people question Multilateral multiple countries coalition is best French president Chirac Single country is best U S president Bush UN Secretary General Annan Usually sucks and leads to instability Studies Bueno de Mesquita and Smith 2006 impact of military intervention on the level of democratization between 1946 and 2001 Findings Intervention leads to a reduction in democracy trappings of democracy such as elections and legislatures happen but fails to increase the level of democracy to a point that most scholars would consider these countries democratic Bottom Up Look at East Germany 1989 Pretty surprising due to police force Inheriting a Soviet Union in crisis Gorbachev responded with two reform policies called Perestroika liberalize and spice up economy and Glasnost political openness The aim of these reform policies was to save the Soviet Union However these reform policies encouraged reformists and opposition groups in Eastern Europe Hungary opened up their borders and everyone went over there which was super embarrassing Neus Forum had protests to stay there and reform Overall it was crappy and Gorbechev was too embarrassed to support socialism there no military intervention 1990 reunification Collective Action Theory mass action Examples revolutions sororities Typically pursuit of public good which is both Non excludable you cant keep it from people and Non rivalrous enough for everyone There s compelling reasons to doubt whether people will take collective action to achieve common interests Collective action free rider prob people within a group have little incentive to contribute because everyone will benefit Collective Action Game Individuals N K people needed for good outcome B benefit provided C cost group member pays The benefit B The cost C Scenario 1 Less than K 1 participates so not enough people Participate means you get screwed with cost C and no benefit B Do nothing nothing happens Scenario 2 Exactly K 1 meaning you are the deciding factor of 1 if you join making it K just enough Participate means you get the benefit B minus the cost C Do nothing means nothing Scenario 3 More than K or what is needed is participating Participate is Benefit B minus cost C as before Do nothing enough are participating so you sit back and get benefit B The two equilibrium 1 If no one is participating no one will want to participate because they will pay the cost of participating but the one person rally will be a total fail 2 If K enough people participate none of the participants will want to stay home because the rally will fail and none of the non participants will want to participate because the rally is already successful You gotta believe that you and only you are likely to participate ALSO 2 factors difference between K needed and N individuals K N means no incentive to free ride because you are needed K N means more incentive to free ride because people needed are less than total amount Greater the gap more incentive to mooch Size of N whole group Influences how crucial you see yourself being also how to monitor and punish free riders Small groups better Just because a bunch of people want to do something doesn t mean they will Explaining participation through puzzles Preference falsification not revealing true preferences in public


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FSU CPO 2002 - Chapter 7

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