Previous research has typically focused on distribution problems that emerge in the domain of gains. Only a few studies have distinguished between games played in the domain of gains from games in the domain of losses, even though, for example, prospect theory predicts differences between behavior in both domains. In this study, we experimentally analyze players’ behavior in dictator and ultimatum games when they need to divide a monetary loss and then compare this to behavior when players have to divide a monetary gain. We find that players treat gains and losses differently in that they are less generous in games over losses and react differently to prior experiences. Players in the dictator game become more selfish after they have had the experience of playing an ultimatum game first.
We conducted experiments on norm focusing. The tests were carried out with two versions of dictator games: in one version of the game, the dictator had to allocate a gain of €10, while in the other version, a loss of €−10 needs to be allocated. In a first treatment, we focused subjects on the average giving in similar previous dictator games. The second treatment focused subjects on the behaviour of what a self-interested actor should do. In total, N = 550 participants took part in our experiments. We found (1) a significant difference in giving behaviour between gain and loss treatments, with subjects being moderately more self-interested in the loss domain, (2) a significant effect of focusing subjects on the average behaviour of others, but (3) no effect of focusing subjects on the behaviour of self-interested actors.
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