Why do people play lotteries when the odds of winning are so low?:
Lotto Makes Sense, Even for Losers, by Benedict Carey, NY Times: At least poker tables have some atmosphere... The same goes for playing the horses: there are characters, scandals, competition, not to mention real payoffs. But who, exactly, wants to stamp their frozen feet waiting in line outside a corner store for an infinitesimal shot at winning the lotto?
The answer, of course, is millions of Americans... [L]otteries are by far the most popular form of gambling... The question is why. ...[A]nyone with a semester of high school math can see what a fool’s bet that is. Generally, ... state lotteries return players about 50 cents on the dollar. And there are many people who seem to compound their folly by buying hundreds of tickets at a time.
Addiction researchers and some economists struggle to explain this behavior, describing it at best as an irrational fever, and at worst a pathological addiction to a regressive, government-run numbers game. But researchers spend little time in corner-store lines.
“The people who denigrate lottery players are ... are numb to its pleasures, so they say it’s not rational,” said Lloyd Cohen ... at George Mason University...
Dr. Cohen argues that... Like a throwaway lifestyle magazine, lottery tickets engage transforming fantasies: a wine cellar, a pool, a vision of tropical blues and white sand. The difference is that the ticket can deliver.
And as long as the fantasy is possible, even a negligible probability of winning becomes paradoxically reinforcing, Dr. Cohen said. “One is willing to pay hard cash that it be so real, so objective, that it is actually calculable...
Because it is pure luck, the lottery is easy to grasp and allows for plenty of perfectly loopy — and very enjoyable — number superstitions... In studies, psychologists have found that ticket holders are very reluctant to trade their tickets for others, precisely because they have an illusion of control from having picked magical numbers.
This sense of power infuses the waiting period with purpose. And the hope of a huge payoff, however remote, is itself a source of pleasure. In brain-imaging studies..., neuroscientists have found that the prospect of a reward activates the same circuits in the brain that the payoffs themselves do.
“It’s not just winning the money but anticipating winning the money that is exciting, and the two experiences are similar neurobiologically,” said Christine Reilly... And lottery odds are neutral and fair, after all, not biased toward any social elite. Seeing a Georgia truck driver win proves that in players’ minds...
Households with regular players spend an average of about 2 percent of their income on the game, studies find. The proportion is higher among very low-income households.
But in most cases all the odds and numbers seem to pale next to the simple pleasure of possible transformation. “I don’t know what I’ll do if I win,” one man standing in line told a reporter last week. “It’s too much money to think about.”
This can explain why some people are reluctant to check to see if they won. It's the same reason some people put off opening gifts. It ends the fantasy.
Posted by Mark Thoma on Sunday, March 11, 2007 at 04:39 AM in Economics |
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