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timtyler comments on On dollars, utility, and crack cocaine - Less Wrong
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A good reason for not playing the lottery is that you can get better odds by playing roulette, or using other forms of gambling. I am unimpressed by arguing against gambling in general because it's average dollar payoff is negative. That argument is ridiculous.
The discussion about lotteries that I presume lead to this thread was correct, though. It didn't talk about expected winnings, it talked about utility. There are cases where playing the lottery has a high utility - and if the utility is too low, then you shouldn't play.
Then the problem is with the argument, not the conclusion. A better argument against gambling is to observe what happens to gamblers, who generally end up broke.
That's habitual gamblers. Gambling is OK sometimes - for example, if it helps you to obtain your ferry fare home, thus saving you a long walk.
Roulette doesn't give a big enough payoff to move you up into the steep area of your utility function, so it doesn't get the "a dollar won is worth more than a dollar spent" effect.
It would also be a plausible conjecture that, if someone's utility function is sigmoid, and they're on the low end of it, their model of their utility function is an exponential. That would enhance the effect.
Re: Roulette doesn't give a big enough payoff [...]
Bet twice consecutively, then. Roulette's payoffs are flexible enough to give you practically any odds you desire.
...and what about the diminishing utility of money? Often you don't want to trade odds for cash.
Just bet 5 times in a row. Still better odds than the lottery.
One problem with that is that, if you've won at roulette a few times in a row, you're now going to be risking quite a lot if you bet it all again. You'll actually end up badly regretting your actions in a lot of cases.
True.
<EDIT> Actually, I don't know if it's true. But it sounds plausible. </EDIT>