Modelling the Dynamics of Identity and Fairness in Ultimatum Game

Abstract: Allocation games are zero-sum games that model the distribution of resources among multiple agents. In this paper, we explore the interplay between an \textit{subjective identity} and its impact on notions of fairness in allocation. The sense of identity in agents is known to lead to responsible decision-making in non-cooperative, non-zero-sum games like Prisoners' Dilemma, and is a desirable feature to add into agent models. However, when it comes to allocation, the sense of identity can be shown to exacerbate inequities in allocation, giving no rational incentive for agents to act fairly towards one another. This lead us to introduce a sense of fairness as an innate characteristic of autonomous agency. For this, we implement the well-known Ultimatum Game between two agents, where their sense of identity association and their sense of fairness are both varied. We study the points at which agents find it no longer rational to identify with the other agent, and uphold their sense of fairness, and vice versa. Such a study also helps us discern the subtle difference between responsibility and fairness when it comes to autonomous agency.