The Ultimatum Game: 2 players – 1 proposes a split or deal, if the 2nd player accepts it then the deal goes through, if the 2nd refuses the deal is off and both parties gain nothing.
“The Ultimatum Game has been pointed to as a way of showing that humans are economically irrational. Why do people reject an offer of 25% of the total pot? If the pot is $100 then they are choosing between getting $25 or nothing at all. So why do they choose nothing at all?
The answer seems to be that people generally find offers below 30% to be insulting. It’s insulting that the other person should suggest such a derisory sum, even when it’s free money. So they prefer to have nothing and punish the other person’s greed. And remember the other person is losing $75 in this case whereas I’m only losing $25.”
“"Cutting off the nose to spite the face" is an expression used to describe a needlessly self-destructive over-reaction to a problem: "Don’t cut off your nose to spite your face" is a warning against acting out of pique, or against pursuing revenge in a way that would damage oneself more than the object of one’s anger.”
In isolation this mechanic is of limited play value. If there is an opportunity to build up a picture of a player’s personality, then the Ultimatum Game could be more interesting. E.g. in games of ongoing negotiation and diplomacy.