Bargaining and ethnic variation within a country * Pedro P. Romero † and Sebasti´an Oleas Department of Economics Universidad San Francisco de Quito Cumbay´a, Quito - Ecuador November 12, 2013 Abstract We report data from a field experiment aimed at determining the extent of both in-group favoritism and out-group discrimination, known as parochial altruism, within a multiethnic society, Ecuador. The main ethnic groups studied so far are the following: mestizos and several indigenous people. We worked with standard, college students, and non-standard subjects, vil- lagers. We took the experimenter and the students out into the field. Par- ticipants play twice an ultimatum game under an in-group and an out-group condition. The second time the game was played we switched the roles of the players while keeping the pair of individuals. We do not find a system- atic evidence for in-group favoritism and out-group discrimination across the groups. Villagers and college students treat more or less equally to in- group and out-group subjects. Finally, there is ethnic diversity regarding hyper-fair preferences, monotonically rational behavior, and the minimum and maximum acceptable offers across groups. Keywords: Bargaining; Field experiment; Multiethnicity * We are very grateful to H. Clark Barrett, Natalia Candelo Londo˜ no, Leda Cosmides, Robin Dunbar, Diego Grijalva, Werner G¨ uth, Dan Houser, Pablo Lucio-Paredes, Julio Ortega, and Wilson P´ erez for their useful suggestions to this project since its early stage. We thank Johana Andrango, Nicholas Gachet and Priscila Vera for excellent research assistance. All remaining errors are ours. We gratefully acknowledge financial support from the Instituto de Econom´ ıa and the Chancellor Grants of the Universidad San Francisco de Quito. † Corresponding author: promero@usfq.edu.ec 1