What Makes Randomness Fair?

Dorothea K Herreiner, Economics Department, Loyola Marymount University

Nikki Yamauchi

Abstract:
This study sheds light on the common claim that random procedures make allocation processes fair. Our experiments are inspired by experiments with variants of ultimatum games by Bolton et al. (2005) that show that offering a random choice with an expected equal allocation lead to a higher rejection rate of an “unfair” allocation favoring the proposer. Bolton et al.’s interpretation is that these changes in rejection rates reflect the perception of random processes as fair procedures. Our experiments show no such effect of random processes leading us to suggest that it is not the randomness that makes a choice more attractive or fair, but the inherently self-serving option of receiving a favorable outcome. Keywords: Procedural Justice, Empowerment, Bargaining
JEL Classification: C91, D63

Current Version: March 2009   [pdf]