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>In the exact same sense than a lottery has a "higher expected return that a conventional job", just with slightly better odds. A lottery has negative expected
by lunchbox 14y ago
>In the exact same sense than a lottery has a "higher expected return that a conventional job", just with slightly better odds.
A lottery has negative expected return, so I disagree that it's "higher expected return that a conventional job".
- batista 14y ago>A lottery has negative expected return, so I disagree that it's "higher expected return that a conventional job". Well, doesn't a startup also have the same "negative expected return"? Or, actually, much worse? (Considering that the majority of them fail and the money you could make just working for some company in the same time). If anything, starting a startup is an investment.
- jamesaguilar 14y agoDo you have data to share with us on this point or is it a feeling/guess?
- lunchbox 14y agoThe point of a lottery is to generate income for the government/company running it, which would not be possible if players collectively won more than they spent.
- JoeAltmaier 14y agotl;dr there are circumstances where the expected value is greater than 1, due to the accumulation of prize money when nobody wins several times in a row.
- sp332 14y agoThanks for this! I had no idea how you could run a lottery which paid out more on average than it took in.
- philwelch 14y agoIn aggregate, all lottery runs put together take in more than they pay out. But an individual lottery run might be -EV for the state if the jackpot has grown enough; however, that only happens after no one wins the lottery for weeks on end, at which point the state has run even bigger profits than before. Once someone wins that big jackpot, the state may pay out more than it took in that particular week, but still less than it took in for the several weeks leading up to the jackpot finally being won.