Publication Type

Journal Article

Version

publishedVersion

Publication Date

6-2021

Abstract

The world spends a remarkable $250 billion a year on lottery tickets. Yet, perplexingly, it has proved difficult for social scientists to show that lottery windfalls actually make people happier. This is the famous and still unresolved paradox due initially to Brickman and colleagues. Here we describe an underlying weakness that has affected the research area, and explain the concept of lottery‐ticket bias (LT bias), which stems from unobservable lottery spending. We then collect new data—in the world’s most intense lottery‐playing nation, Singapore—on the amount that people spend on lottery tickets (n = 5626). We demonstrate that, once we correct for LT bias, a lottery windfall is predictive of a substantial improvement in happiness and well‐being.

Keywords

happiness, income, well-being, GHQ, mental-health, lottery, Singapore, lottery ticket bias

Discipline

Behavioral Economics

Research Areas

Applied Microeconomics

Publication

Review of Income and Wealth

Volume

67

Issue

2

First Page

317

Last Page

333

ISSN

1475-4991

Identifier

10.1111/roiw.12469

Publisher

Wiley

Copyright Owner and License

Authors-CC-BY

Creative Commons License

Creative Commons Attribution 4.0 International License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Additional URL

https://doi.org/10.1111/roiw.12469

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