Small Groups Of People Behave Rationally When Deciding On Money Matters
Leading author Wim De Neys of the National Center for Scientific Research (CNRS) in France and his team examined the behavior of individuals in the Ultimatum Game. The object of the game was for two players to split a sum of money whereby one player makes an offer that the other must either accept or decline. If the offer is refused, neither player receives any money.
The scenario predicted by most economic models, which also represents the rational choice, would be for the first player to offer just a small amount to the second player, with the second player accepting the offer, based on the theory that something is better than nothing. Most people behave differently though; the researchers observed that the first players often offer an even split, whilst the second players often reject an offer of an uneven split. This could be due to strong emotional motives. Only a small group of people acted as expected by the models.
Further investigations of this small group of people revealed these individuals possessed a high "cognitive control" measured by performing a simple computer task, such as brain-imaging during an easy computer task compared with non-rational players. It proved that this group of people generally demonstrated a greater ability in overriding impulsive tendencies, enabling them to act more in line with traditional economic models and make more money in the long-term.
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De Neys W, Novitskiy N, Geeraerts L, Ramautar J, Wagemans J (2011) "Cognitive Control and Individual Differences in Economic Ultimatum Decision- Making". PLoS ONE 6(11): e27107. doi:10.1371/journal.pone.0027107
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