Monday, October 22, 2012

Revenge is good

for some reason i started thinking about the selfish nature of humans, and that oft quoted aspect that people only ever doing things for themselves. and it's possible i've remembered an exception. the experiment goes something like this:
i sit you down at a table. i tell you there's someone in the room next door. i place £10 in front of you and tell you to offer as much or as little of this as you like to the person next door, the rest you keep. the catch (of course there's a catch!) is that they have to accept the offer for you both to receive the money. otherwise you both get nothing.

in theory, they should accept anything, since 1p > 0. however, most people would reject a deal splitting it £9.99 and 1p, because of revenge. this concept is so ingrained, i don't think anyone who took part in this experiment offered so little because they knew it would get rejected.

people rejecting offers which are too low, and hurting themselves is purely spite. but this fear of revenge where people hurt themselves to hurt you more is apparently good for society.

a guy at MIT called Dan Ariely has written books and papers on the subject. My only problem is that he called the book the upside of irrationality and then described how all these seemingly irrational actions were rational. so it should be called the upside of counter-intuitivity.
anyway, there's a nice clip of him explaining it here

turns out, revenge is also done for selfish reasons since you benefit long term.


Yakshi said...

Cool video. In law school, we covered a similar game. Two players. A gets $10. B has nothing. A can offer B whatever he likes. A and B can only keep the money is B agrees to the terms.

When we did the experiment in class, more than half of the time, Player A offered $4 to Player B. Once the experiment was over, the teacher showed us that our results were the same as other groups. Why $4? Why not $3? $5? $1?

Fun stuff.

Mudwig said...

thats cool!
i never got to do anything interesting at school other than make ice cream and watch what happens when you sit on a swivel chair and spin a bike wheel.

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