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WressLong 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: WressLong 24 May 2016 09:08:22PM 0 points [-]

You describe the millionaire daydream as a sink. That could be reframed as an opportunity cost. The same as any short-term v. long-term gratification, the time spent daydreaming may create an opportunity cost wherein the preoccupied brain isn't investing in some other opportunity that could lead to higher returns in the future, such as your technical school example. This simply restates that the costs of the lottery ticket are the lost marginal utility of the dollar which could have been spent on, or invested in something else, plus the opportunity cost of the lost time spent daydreaming that could have been spent on something else. The benefits are the marginal utility derived from the time spend daydreaming.

In that regard, it still seems that the purchase may be good for some, if they can afford the dollar, they enjoy the daydreaming, and the determine that the opportunity cost is low. It all seems to hinge on the individuals utility functions for the dollar, the daydream, that the expected future value of the rewards associated with the alternative time lost to daydreaming.