The effect of endogenous endowments: Evidence from a mini-ultimatum game

We extend the mini ultimatum game to investigate the effect of two types of endogenous endowments: one created by real effort and one created by subjects' choices in a risky environment. Compared to an exogenous endowment, the probability of rejection for a given size endowment is more than 44% lower when responder effort generates the endowment. However, rejection rates differ across endowment sizes: the probability of rejecting a low offer increases with endowment size when the responder produces the endowment, and decreases with endowment size when the endowment is determined exogenously. The results differ considerably from the only other real-effort ultimatum game experiment, indicating that more research is needed in this area to better interpret why offers are rejected in the ultimatum game.