Pakistan Institute of Development Economics



The Ultimatum Game and Gender Effect: Experimental Evidence from Pakistan

Laboratory experimentation was once considered impossible or irrelevant in economics. Recently, however, economic science has gone through a real ‘laboratory revolution’, and experimental economics is now a most lively subfield of the discipline. This study attempts to examine answers to questions of the changing behaviour of opposite sexes under conditions of both anonymity and knowledge of gender by playing the ultimatum game in Pakistan. It is observed that the behaviour of males and females in Pakistani society is quite different from that found in earlier studies. Insights from the previous experiments have already shown that normative economic theory had failed in its predictions of human behaviour. Currently, the ultimatum game is widely discussed in behavioural economic literature, and this paper will adjust the traditional ultimatum game into a new form wherein it will be tested in the country (Pakistan) with multidimensional behaviour of subjects. With regard to gender effect specifically, all previous studies came up with somewhat mixed results, since results do not always point in the same direction and it is rather early to draw far-reaching conclusions regarding the behavioural differences of men and women. More facts are required in order to move towards the development of a systematic theory. This work is a small attempt to investigate the changing behaviour of opposite sexes under different controlled conditions.

Shahid Razzaque