When social accounts promote acceptance of unfair ultimatum offers: The role of the victim’s stress responses to uncertainty and power position

Abstract

We examined which type of social account (denying responsibility versus apologizing) following an unfair offer makes recipients more likely to accept the offer in ultimatum bargaining. We identified stress responses to uncertainty as an individual difference factor that should moderate the relative effectiveness of these social accounts. A denial should make acceptance of an unfair offer more likely among recipients who respond to uncertainty with low stress. An apology should make such acceptance more likely among recipients who respond with high stress. Further, we argued that this cross-over interaction should be observed particularly among recipients interacting with a high power allocator. Two ultimatum bargaining experiments supported these ideas. Employing the perspective of victims of unfairness, the present research identifies a relevant individual difference moderator of the effectiveness of social accounts in bargaining situations and identifies power as a situational variable that promotes the expression of this factor.

Introduction

Concerns about fairness impact behavior in bargaining situations significantly, as illustrated by bargainers’ tendency to reject unfair offers in ultimatum bargaining games (see Chaudhuri, 2009, for an overview). Such rejections result because unfair offers arouse anger in victims and, consequently, a desire to “get back at” at the offender (Pillutla & Murnighan, 1996). Unfair offers and the resulting retaliatory behaviors thus make effective and successful bargaining difficult. Unfortunately, such events cannot always be avoided because bargainers’ behavior often reflects their own interests, at the expense of fairness (Van Dijk, De Cremer, & Handgraaf, 2004). This makes it necessary to know how to deal with the emergence of unfairness in order to stimulate effective bargaining.

A growing body of research shows that an effective way to deal with wrongful and unfair acts may be the provision of a social account in which the offender denies responsibility, or conversely, apologizes by accepting responsibility for the harm done and issuing a promise to make things better (see Dirks, Lewicki, & Zaheer, 2009, for an overview). The present paper examines how such social accounts can be useful to deal with the emergence of unfairness in ultimatum bargaining situations. Specifically, we will study the impact of apologies and denials of responsibility in promoting acceptance of unfair ultimatum offers.

To examine the effectiveness of these specific social accounts, we, first of all, introduce the moderating role of individual differences in stress levels as a response to uncertainty. Bargaining involves high levels of uncertainty about the interaction partner’s intentions and motives, and also about one’s bargaining outcomes (e.g., De Cremer et al., 2010, Roth, 1995). This uncertainty often induces stress (Greco and Roger, 2001, Greco and Roger, 2003). We argue that whether bargainers respond to uncertainty with heightened stress or not determines how they experience the violation of an unfair ultimatum offer. Apologies and denials each address specific violation experiences (Ren & Gray, 2009). Hence, the effectiveness of a specific social account in promoting acceptance of unfair ultimatum offers should be contingent upon individual differences in bargainers’ stress levels as a response to uncertainty.

Further, as a stringent test of our idea that the effectiveness of specific social accounts results because they address specific violation experiences that can result from receiving an unfair ultimatum offer, we examine the role of bargainers’ power as a boundary condition to this effect. Power influences whether people feel vulnerable in their interactions with others and, consequently, whether they attempt to assess their interaction partner’s intentions and motives (e.g., Fiske, 2001, Rusbult and van Lange, 2003). Hence, bargainers’ power should influence whether social accounts (as a function of stress responses) will promote acceptance of unfair ultimatum offers.

We will test our hypotheses in two ultimatum bargaining studies (Güth, Schmittberger, & Schwarze, 1982). All our participants are assigned the role of recipient and receive an unfair offer (i.e. 60% for the allocator and 40% for the recipient). The allocator then issues a denial or an apology for the unfair offer. In order to be able to compare the relative effectiveness of denials and apologies, it is important that both a denial and an apology are credible as social accounts. We therefore introduce some ambiguity in the procedure regarding whether the allocator is responsible for the unfair offer (taken from De Cremer et al., 2010; see also Kim, Ferrin, Cooper, & Dirks, 2004). We vary the power structure of the game by varying recipients’ power to reject the offer (taken from Suleiman, 1996).