4 ms·

Lotteries work like a social safety valve. They give hope to the poor that there is a chance, however small, that they will make it big and sort out their finan

by pehtis 8y ago

Lotteries work like a social safety valve. They give hope to the poor that there is a chance, however small, that they will make it big and sort out their financial problems just by winning the lottery. And so they keep working and trying and living their lives despite the fact that there is basically zero chance of ever earning enough money, because: "Someone wins the lottery every week! Next week it could be me!!".

kbenson 8y ago
It's interesting to note that given the oft cited statistic that lotteries are disproportionally consumed by the poor, that amount they are disporportionally consumed and how that statistic is come by might not lead to the conclusions people often jump to: The data reveal the following general trends. First, lottery gambling extends across races, sexes, and income and education groups. Second, black respondents spend nearly twice as much on lottery tickets as do white or Hispanic respondents. The average re- ported expenditure among blacks is $200 per year ($476 among those who played the lottery last year). Black men have the highest average expenditures. Third, average annual lottery spending in dollar amounts is roughly equal across the low- est, middle, and highest income groups. This implies that on average, low–income households spend a larger percentage of their wealth on lottery tickets than other households.[1] Those in the lowest fifth in terms of socioeconomic status (SES) had the “highest rate of lottery gambling (61%) and the highest mean level of days gambled in the past year (26.1 days).” Moreover, there were “very few observed differences in lottery gambling for those in the three upper SES groups — 42–43% gambled on the lottery and the three upper groups averaged about 10 days of gambling on the lottery in the past year.”[2] It's clear that the poorest people may more, and it's more of their relative income, but it's not anywhere near rate for other income groups to play as well. The real interesting take-aways I see are what you get when you look at the following two facts (shown above): - The lowest quartile income group only plays about 50% more often than the other quartiles (~60% compared to ~40%). - Each tertile income group spends approximately the same amount of real dollars. With these, it starts to look a lot less like some tax on the poor and/or stupid that people like to classify it as, and more as a cultural phenomenon (or something that plays to the human psychology, since I think it's fairly common in most cultures). It may indeed be that the lottery works as an aspirational tool, as you note. But I think it must also be working in other ways, otherwise I'm not sure why we would see such large investment from higher income groups as well. 1: https://www.ntanet.org/NTJ/58/2/ntj-v58n02p281-302-economic-winners-losers-legalized.pdf https://www.ntanet.org/NTJ/58/2/ntj-v58n02p281-302-economic-... 2: https://journalistsresource.org/studies/economics/personal-finance/research-review-lotteries-demographics/ https://journalistsresource.org/studies/economics/personal-f...

by pehtis 8y ago

kbenson 8y ago

It's interesting to note that given the oft cited statistic that lotteries are disproportionally consumed by the poor, that amount they are disporportionally consumed and how that statistic is come by might not lead to the conclusions people often jump to: The data reveal the following general trends. First, lottery gambling extends across races, sexes, and income and education groups. Second, black respondents spend nearly twice as much on lottery tickets as do white or Hispanic respondents. The average re- ported expenditure among blacks is $200 per year ($476 among those who played the lottery last year). Black men have the highest average expenditures. Third, average annual lottery spending in dollar amounts is roughly equal across the low- est, middle, and highest income groups. This implies that on average, low–income households spend a larger percentage of their wealth on lottery tickets than other households.[1] Those in the lowest fifth in terms of socioeconomic status (SES) had the “highest rate of lottery gambling (61%) and the highest mean level of days gambled in the past year (26.1 days).” Moreover, there were “very few observed differences in lottery gambling for those in the three upper SES groups — 42–43% gambled on the lottery and the three upper groups averaged about 10 days of gambling on the lottery in the past year.”[2] It's clear that the poorest people may more, and it's more of their relative income, but it's not anywhere near rate for other income groups to play as well. The real interesting take-aways I see are what you get when you look at the following two facts (shown above): - The lowest quartile income group only plays about 50% more often than the other quartiles (~60% compared to ~40%). - Each tertile income group spends approximately the same amount of real dollars. With these, it starts to look a lot less like some tax on the poor and/or stupid that people like to classify it as, and more as a cultural phenomenon (or something that plays to the human psychology, since I think it's fairly common in most cultures). It may indeed be that the lottery works as an aspirational tool, as you note. But I think it must also be working in other ways, otherwise I'm not sure why we would see such large investment from higher income groups as well. 1: https://www.ntanet.org/NTJ/58/2/ntj-v58n02p281-302-economic-winners-losers-legalized.pdf https://www.ntanet.org/NTJ/58/2/ntj-v58n02p281-302-economic-... 2: https://journalistsresource.org/studies/economics/personal-finance/research-review-lotteries-demographics/ https://journalistsresource.org/studies/economics/personal-f...