Instructions

This part of the experiment will consist of two periods.

In this part, there will be two types of people, Red and Blue. You will be both a Red person and a Blue person depending on the period. Each period you will be randomly paired with a person of the other type. In this experiment you will interact with 2 other people.

Instructions for Blue People

Each Blue person begins each period with 100 points. A Blue person may choose to send some, all, or none of these points to a Red person he/she is paired with by typing the amount into a box in the center of the screen and then clicking “Next”. Any points that a Blue person sends to a Red person will be subtracted from the Blue person's account, multiplied by 3 and transferred to the Red person. Any points that a Blue person chooses not to send to the Red person remain the Blue person's earnings. (Only Blue people will be able to send points and have them multiplied.)

Instructions for Red People

Each Red person enters a period with 100 points. After the Blue person makes a decision, the Red person will see how many points were sent from the Blue person. The amount sent by the Blue person will be multiplied by 3 and added to the Red person's account. Then the Red person decides to send some, all or none of these points to the Blue person by typing the amount into a box in the center of the screen and then clicking “Next”. (Only Red people will make this decision.) In each period, each Red person is paired with one Blue person for the entire period. (One “period” consists of one Blue person deciding how many points to send to one Red person and that Red person deciding how many of the multiplied points to send to the paired Blue person.)

Summary

A Blue person earnings for a period are: Earnings = Starting points minus Amount Sent to Red plus Amount Received from Red

A Red person earnings for a period are: Earnings = Starting points plus Amount Received from Blue x 3 minus Amount Sent to Blue

Both the Blue and the Red people will be informed of the outcome at the end of the experiment.