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Everywhere, people say they prefer lotteries where there are more prizes with smaller wins, instead of one winner with huge jackpot. But also everywhere, their
by ptaipale 7y ago
Everywhere, people say they prefer lotteries where there are more prizes with smaller wins, instead of one winner with huge jackpot. But also everywhere, their actual bahaviour is that when there is one big jackpot, they bet more.
And those who arrange lotteries do know their business.
- bena 7y agoExactly. Don't listen to what people say they will do, watch what they actually do.
- arisAlexis 7y agomarcus Aurelius
- arisAlexis 7y agothis forum is becoming very low in quality. someone downvoted my information about who said that
- bena 7y agoI think the issue might be that it's a common enough thought that attribution isn't important as multiple people could have derived that independently and that simply attributing where a paraphrased quote comes from without any other commentary is in itself low quality.
- izzydata 7y agoThat's probably true. They should try to educate people that if there are 250 times as many winners that your chances of winning a significant amount of money is much higher.
- Johnny555 7y agoI think if you could educate people on their expected return from a lottery ticket purchase, they wouldn't play at all. Telling people that they have a 95% chance of winning nothing at all is not a good way of selling lottery tickets.
- basementcat 7y agoExpected return may be helpful but imo not sufficient without variance. Some cumulative jackpots are large enough that the expected return is actually profitable but the probability of actually hitting the numbers is vanishingly small.
- gylterud 7y agoHowever, even with positive expectation value, you should not always play. One should first check the Kelly criterion, which is well explained Russel O’Connor’s blog post: “Do Not Play the Lottery Unless You Are a Millionaire” http://r6.ca/blog/20090522T015739Z.html http://r6.ca/blog/20090522T015739Z.html
- p1necone 7y agoI think it's naive to value a lottery based solely on your monetary expected value. The value of money doesn't increase linearly, and isn't the same for everyone. $20 could have an inconsequential effect on my quality of life, while winning say $2 million could be a total life changer. Likewise, the difference in impact between winning $0 and winning $2 million is likely a lot larger than the difference between winning $2 million and winning $4 million. So a straight EV calculation doesn't really tell the whole story. There's also the entertainment value of participating in the lottery to consider, even when you win nothing.
- p1necone 7y agoPersonally I like to think of lotteries as a binary thing - either I win enough money to retire now, or I don't.
- caymanjim 7y agoPeople aren't betting that way because they're uneducated. People generally don't play the lottery because it's statistically wise. They play because dropping $1-3 on a ticket is no big deal, and it provides a little excitement and lets them fantasize about the winnings. Fantasizing about what you'd do with $250M is a lot more exciting than fantasizing about what you'd do with $1M, and once the odds are low enough, any emotional investment in the math is going to be lost in the rounding error.
- flukus 7y ago> and it provides a little excitement and lets them fantasize about the winnings I've heard this before, but why do you need a ticket to fantasize about what you'd do with that much money? It can be a conversation starter and I can see the excitement aspect in watching your numbers come up (if you don't have a hundred combos to watch at once), but fantasizing is free.
- CydeWeys 7y agoAs someone who's bought a few lottery tickets in his life, I can confirm that the fantasizing is in fact better when it's about something that could happen to you.
- gowld 7y agoYou could have a rich uncle in Scandinavia about to die and leave you $200M
- sigstoat 7y agoyou could also just happen to find a winning lottery ticket on the street. the likelihoods of the two events are similar, and one fantasy is free.
- sushid 7y agoHave you tried buying a lottery ticket? It sure feels a lot different than the "free" variety you're proposing. And props to you if you're a true rationalist who derive nearly equal amounts of satisfaction from both fantasy events, but most people don't behave like that.
- ikeyany 7y agoIf the lottery was in the business of educating people, they would lose their customer base.
- beerdoggie 7y agoI know that this is true, but if you have a good blog post explaining these statistics i'd appreciate it!
- Bakary 7y agoThe odds are low enough that multiplying by 250 doesn't make much of a difference.
- deleted 7y ago[deleted]
- maxxxxx 7y agoWhen I play (I don't know why but somehow I find it fun) I actually play SuperLotto which has a chance of 1 in 41,416,353 vs 1 in 292,201,338 with PowerBall. Better to make a few million with better odds than a few hundred million with worse odds. Never mind that it's much more likely that I will get struck by lightning :-(
- deleted 7y ago[deleted]
- ralusek 7y agoThat final 7x increase to the odds is the one that makes it not worth your while?
- maxxxxx 7y agoI didn't say it's well thought out...
- robujohnson 7y agoIf you want to win life-changing money, why not take the better odds?