Trust Before Profit: The Power of Reciprocity in Māori Business

“Would you like some cake?” Said my brother. “I have this giant Black Forest Cake that Mum gave me.” “I will give you a little bit, but I want to keep most of it for myself”.

Fair deal?

There is an experiment in Behavioural Economics called the Ultimatum Game, which cartoonist Zach Weinersmith beautifully summarises in SMBC-Comics.

The ultimatum game is a fantastic way to explore the dynamic of tauutuutu/reciprocity. I recently surveyed 15 of Aotearoa, New Zealand’s top Māori Agribusiness leaders. These people run large and successful operations deeply intertwined with the global economy and modern financial markets.

I included two versions of the Ultimatum Game in this survey. Thousands of Ultimatum Games have been run around the world with diverse participants. From this research, some clear trends have emerged.

• People in Western countries tend to offer a 50/50 split. Refer to the comic above – this goes against our standard economic models.
• Most people will reject a split of 30/70 or below. Again, this contradicts much economic theory.

For anyone who is not an economist, the reason people behave like this is obvious: We are driven by fairness, reciprocity, and a host of social norms that influence our behaviour. Below is a typical set of outcomes from an Ultimatum Game.

Mendoza, Saaid A., Sean P. Lane, and David M. Amodio. “For members only: ingroup punishment of fairness norm violations in the ultimatum game.” Social Psychological and Personality Science 5.6 (2014): 662-670.

We can see that when the offer is $6, i.e. a 30/70 split, only 20% of people accepted the offer. In this case, the results are presented by ethnicity, which did not affect the most unfair splits.

I presented the agribusiness leaders with the following scenario, which mirrors a classical Ultimatum Game.

Ultimatum Game 1.

We have all the elements here:

• Money comes from an outside source that neither party has any prior claim to.
• They cannot negotiate—this is a one-shot deal; the agribusiness leader can only accept or reject it.
• If they reject it, neither party gets anything.

Based on decades of Game Theory experiments in Western countries, we would expect that most agribusiness experts would reject this offer as it is right on the boundary of what studies show is an ‘unfair’ deal. But what we saw was this.

60% of the agri-business leaders accepted the deal.

In the chart from the study I shared previously, only 20% accepted a similar deal. Our respondents were highly experienced business leaders who frequently allocate resources and negotiate business deals.

I followed this first scenario with another that deviates from the classical Ultimatum Game and introduces a second round of deal-making. In this scenario, a relationship has been established, and the two companies have worked together successfully on two projects.

This time, the agribusiness leader’s company proposes a 50/50 split, and the other company counters with a 40/60 split in favour of themselves. Again, the agribusiness leaders can choose to accept or reject.

In this case, the deal is fairer, but we have introduced a key factor: despite working together for a while, the other company still does not propose an equal split. So, what proportion of the agri-business leaders accepted this deal?

87% accepted the deal

While I have not yet gone deep into analysing the data – it points to a substantial willingness to enter business relationships despite seemingly unfair terms.

Our Ultimatum Game was run face-to-face with the agribusiness leaders. Therefore, we gained some insight into the reasoning behind their decisions. This is where the tauutuutu/reciprocity came to prominence.

Before I share my thoughts on what is happening here, I want to provide a few direct quotes from the participants, as they give the best insights.

Reasons given for accepting:

Strengthening trusts and relationships will always be important to me and is just inherent in how we operate as Māori.

We should prioritise collaboration over profits for the wellbeing of our farm and for future benefits.

Relationships are always going to be the most important as Māori. The profits that we draw are able to then grow our people

We have the IP and hopefully we can develop our own people to look at our own markets and utilise the relationships and networks we have.

And – we have one response that was more neo-classical:

It’s better than not making any money from a project that never happens and potentially it could lead to something better.

The common theme that ran through most of the explanations for accepting the offers was relationships. Several observations emerge when viewing the results through the perspective of tauutuutu and ongoing reciprocal exchange:

• Escalation & Commitment: Tauutuutu involves a cycle where subsequent exchanges match or exceed each contribution. The jump in acceptance rates between the first (60%) and second ventures (87%) demonstrates this escalating pattern of trust and reciprocity.
• Cultural Long-Term Reciprocity: In Māori tradition, reciprocal exchanges are woven into lasting social and political relationships rather than one-off transactions. The results showed that participants valued these long-term relationships even when immediate profits weren’t optimal.
• Experience & Trust: Experienced leaders were initially more cautious but showed increased acceptance in second scenarios, while less experienced leaders accepted at 100% from the start. This reflects different approaches to establishing trust and reciprocity based on experience level. The less experienced leaders were all younger, which may indicate an even deeper focus on relationships for them.
• Business Implications: The survey data shows how reciprocity can build stable business relationships through gradual trust-building. This approach emphasises the importance of aligning transactions with social values and developing long-term partnerships.
• Māori Implications: High acceptance rates in second ventures demonstrate the continued relevance of Tauutuutu in modern business contexts. The results show that this approach works effectively regardless of experience level, confirming the adaptability of Māori reciprocity principles.

The findings, viewed from a Tauutuutu perspective, underscore the enduring power of Māori reciprocity. The unexpectedly high acceptance rates from the first game show a powerful drive to build relationships despite an initially unfair deal. The progression to very high acceptance in the second venture signals the strength of escalating reciprocal exchanges in fostering trust. This dynamic holds significant implications for businesses seeking to build durable partnerships and for Māori who continue to apply the ethic of tauutuutu as an integral foundation of commercial success and generational sustainability.

The Ultimatum Game was only one component of this research. We also conducted a vignette survey which investigated how Māori business leaders would allocate resources across the following key success factors to improve the success of agricultural enterprises at different stages of their development:

1. Accessing or building technical skills and knowledge
2. Accessing finance
3. Securing access to premium markets
4. Strengthening trust and relationships

But that is a story for another day…

My one big takeaway from this research is that the ethic of tauutuutu is not just a value discussed by academics like me; it is a real and significant driving factor in Māori organisations. This has implications for anyone working with Māori. It suggests that relationships are critical—even more so than profit—despite the financial context in which these organisations may be operating. It also presents some risks for Māori enterprises when working with businesses that do not understand this relational focus. Again, this is a topic I will dig into in the future.

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