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Blackened comments on Lotteries: A Waste of Hope - Less Wrong

28 Post author: Eliezer_Yudkowsky 13 April 2007 05:36AM

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Comment author: Blackened 12 July 2012 08:12:07PM 0 points [-]

I'm still not convinced that I shouldn't buy lottery tickets.

Assume a hypothetical situation. There's a lottery right next to where I study/work. Also, I realize how silly it is to actually expect to win the lottery after buying a lottery ticket, so I can't use this as a source of positive emotions, even if I want to. However, buying lottery tickets let me engage in certain social situations, which just barely outweigh the time wasted for them (but not the money) - alternatively, you can instead assume that it takes me 0 seconds to buy a ticket and later to check if I won.

I reckon this question has already been answered, therefore links are a completely acceptable response.

Also, I'd never buy a lottery ticket. It's because of expected value. However, I'm still trying to solidly prove that decision-wise, expected value is equivalent to predicted reality (of course, after uncertainty is taken into account).

Comment author: Vaniver 12 July 2012 08:18:33PM 0 points [-]

The response I would make is that you're not buying a lottery ticket; you're buying a social interaction ticket, and that can be rational. Given the "waste of hope" message, though, hypothetical you should think long and hard about whether that social interaction is positive.

Comment author: Blackened 12 July 2012 08:22:45PM 1 point [-]

However, we assume that the social interaction itself isn't enough to justify my ticket. Let's say it's just a warm greeting and a short small talk with someone I find sympathetic, but probably won't play a decisive role in my future. And I'm buying the ticket, because I rationally know that I might win the lottery (despite that I find it so unlikely that I don't actually expect it). I have only included the social interaction to offset the wasted time.

Comment author: Vaniver 12 July 2012 08:42:55PM 1 point [-]

Ah, now I see what you're trying to get at.

You might be interested in reading about VNM utility maximization and prospect theory.

The first basically says "let's come up with an imaginary score that we give to potential futures, such that that we can do expected value calculations over probabilistic gambles between those potential futures, and the EV calculation will be correct by definition." This is generally recommended as a good way to make decisions (at least, it clarifies what the difficult parts are- but beyond focusing your attention may not make them easier).

The second asks how various descriptive biases coexist, and comes up with a model that has three deviations from risk-neutral VNM but fits how many humans actually behave.