AI Practice Knowledge BaseCounterintuitive Facts (17): Why Would You Rather Lose Money Yourself Just to Make the Person Who Earned More Suffer?
PremiumInequity Aversion: Humans don't pursue profit maximization, humans pursue 'don't let him have it better than me'
I. A simple experiment. I give you $100 to split with a stranger. Rules as follows:
- You propose a split (e.g., you get $90, they get $10)
- If they accept, that's the split
- If they reject, the $100 is taken back, nobody gets anything
II. Logically, as a rational person, even if they can only get $1, it's free money. Something is better than nothing. They should accept any allocation greater than 0.
III. But experiments show: As long as you give them less than 30% (considered "unfair"). The vast majority will choose to reject. Meaning: "Go to hell with your $10. I'd rather not have this money just to make your $90 go up in smoke!" This is called Inequity Aversion.
IV. This is a self destruct program deeply embedded in primate genes. To punish that "unfair" person, we're willing to hurt ours
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