5 ms·
>Dismissing long-standing ethical objections to the lottery, these new advocates reasoned that, since people were going to gamble anyway, the state might as wel
by kwere 4y ago
>Dismissing long-standing ethical objections to the lottery, these new advocates reasoned that, since people were going to gamble anyway, the state might as well pocket the profits
>The whole thing was hugely counterintuitive—the worse the odds of winning became, the more people wanted to play. Alexander Hamilton was right: to the average person, the difference between one-in-three-million odds and one-in-three-hundred-million odds didn’t matter, but the difference between a three-million-dollar jackpot and a three-hundred-million-dollar jackpot mattered enormously. Recognizing this, lottery commissioners began lifting prize caps and adding more numbers
>The irony, as Cohen notes, is that this obsession with unimaginable wealth, including the dream of hitting a multimillion-dollar lottery jackpot, corresponded to a decline in financial security for most working people. Beginning in the nineteen-seventies and accelerating in the nineteen-eighties, the income gap between the rich and the poor widened, job security and pensions eroded, health-care costs and unemployment rose, and, for children born in those decades, our long-standing national promise—that education and hard work would render them better off than their parents—ceased to be true. Life, as it turned out, imitated the lottery: for most Americans, it was getting harder and harder to win.
a tax on the desperate, ignorants and numerically illiterate. should be banned outside local charity with x prizes to tickets.
- skohan 4y agoI think it's also a perfect counterexample to the assumption of rationality by the Chicago school of economics.
- sicp-enjoyer 4y agoThat's not how economists use rationality. Individuals derive other enjoyments from gambling besides their earnings. This desire to seek things they like is the "rationality", purposeful behavior, not the ability to make optimal bets or play mathematical games.
- nerdponx 4y agoYet the economics literature is full of this exact misuse of the term "rationality", not to mention what economists say in their blogs, op-eds, and interviews. Not to mention the traditional econ 101 curriculum.
- sicp-enjoyer 4y agoIn the literature I have read, this point is one of the first things they clarify and address common criticisms.
- RunSet 4y agoAnother such example that rational self-interest is an invalid assumption: > Mr Greenspan admitted that his view of the world had been flawed. > Self-regulation by Wall Street had failed, he said. "Those of us who have looked to the self-interest of lending institutions to protect shareholder's equity – myself especially – are in a state of shocked disbelief." > And he went on: "I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works." https://www.independent.co.uk/news/business/news/greenspan-says-crisis-left-him-in-shocked-disbelief-971609.html https://www.independent.co.uk/news/business/news/greenspan-s...
- colinmhayes 4y agoYou have no way of knowing how much utility the lottery players gain outside of their expected winnings.
- trgn 4y agoStates have an unspoken (but true) interest in lotteries because they are an important pacifying force. As long as a multitude believe there is a magical way out, they will not rise up and riot. State run lotteries really took off after the revolutionary fervor in the early 1800s, it's not a coincidence. Paradoxically, there's generally a second but equally required counterforce to sustain the hypnosis. A constant drip-drip of content about how money doesn't really cause happiness. Hence, frequent news stories about lottery winners blowing through their winnings or losing friends and family in the subsequent strife. This is to make the status-quo (aka reality) tolerable, it's the soothing balm. It's really absolutely shameful. 100% agreed, lotteries need to be banned, except for trivialities like school raffles or bingo or what have you.
- fortran77 4y agoAccording to the linked book review, state run lotteries came much later in the 2nd half of the 20th century, and with different motives.