Monday, April 4, 2011

The Problem(s) with Fairness, part 2

Last week we explored the inherent unreliability of fairness claims.  Our sense of what's fair is so tied to our own self-interest and perspective that four out of ten people change their minds on a simple fairness standard depending on which side they imagine themselves to be on.  Given this, it's hardly surprising that when we actually are on different sides of a dispute we often find that each side thinks that their demands are fair.

This leads to two problems.  The first is that our human minds are extremely vulnerable to irrational behavior when we think we're being treated unfairly.  A popular experiment illustrates this.

Imagine you're playing the following game.  You and another person have been chosen at random to divide $100 between you, but there's a catch.  The other person gets to make the division -- that is, they decide how much they get and how much you get.  You then get to decide if you accept their split.  If you accept, the split happens and if you don't accept then neither of you gets anything.  You're not allowed to talk beforehand and the game is anonymous -- no one will ever know you were chosen to play unless you decide to tell them about it.

Now suppose the split is revealed and it's $90 to the other person and $10 to you.  Do you accept?  Remember, your only alternative to accepting is to get nothing -- there are no second chances or renegotiations.

From a purely rational perspective you should take the $10.  Refusing is equivalent to finding a $10 bill on the street and throwing it in the trash just to make sure that some stranger out there doesn't get $90.  And yet, a very large number of people will refuse "unfair" offers when this game is played with real money.

During debriefs, people who didn't accept often offered rational explanations for their decision.  They may have worried about signaling effects -- other people might see them as someone who could be pushed around or who would take any deal.  Brain scans call these explanations strongly into question.

A comparison of brain scans show that the planning section of the brain fires in people who receive "fair" splits (typically offering them at least 40% of the money).  They are thinking rationally about the money.  What part fires in the brains of people who receive unfair offers?


Now imagine you're having a dispute with someone and you're arguing about what's fair.  We know from self-interest bias that each of your perceptions of fairness are likely to be biased in opposite directions.  As a consequence, you're each likely to think that the other person is putting forward something unfair while claiming that it's fair.  We also know the natural human reaction to perceived unfairness -- disgust.  How optimistic are you that you'll be able to bridge the gap using reason when each of you are bound by this intense emotional response?

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