You are one of two people in an experiment. The other person is handed $100 and has the choice of either splitting the money 50-50 with you, or taking $90 and giving you $10. You can accept or refuse the offer.
The other person takes $90 and offers you $10. Do you accept?
Chances are that you will reject the offer and thus end up with no money even when you could have had $10. This is completely irrational behavior, but you were disgusted by the behavior of the other person and wanted no part in it.
Businessweek writes about neuroeconomics:
According to the new science of neuroeconomics, the explanation might lie inside the brains of the negotiators. Not in the prefrontal cortex, where people rationally weigh pros and cons, but deep inside, where powerful emotions arise. Brain scans show that when people feel they’re being treated unfairly, a small area called the anterior insula lights up, engendering the same disgust that people get from, say, smelling a skunk. That overwhelms the deliberations of the prefrontal cortex. With primitive brain functions so powerful, it’s no wonder that economic transactions often go awry.
We can extend this to games. Players do not always play rationally, but sometimes they do.
Here’s a prediction that I have not tested:
It would be nice to empirically test this.