Whenever someone buys a lottery ticket, they are completely aware that the chances of winning a jackpot are extremely low. This means that the value you are expecting to get from this ticket is zero. You know that 9,999 out of 10,000 times, this lottery ticket will give you nothing. In terms of the economic utility, you are buying something but not really expecting a return.
The way we rationalize buying a lottery ticket is simple. Our mind thinks that the utility lost in $1 or $2 is worth it for the one in a million chance that we might win a crazy amount of money. This means that the utility in your mind of this lottery ticket is always positive. If you lose, that is what you expected. If you win, it is an incredible, surprising bonus. This rationale makes the lottery jackpots the best kind of gambling.
Lottery vs. Other Gambling –
When you engage in other types of gambling, there is often an excitement associated with playing. The energy surrounding a craps or poker table is undeniable. People may play those games for the money, but they keep coming back for more because of the excitement. That is why those games are addictive.
In contrast, the lottery is rather boring. Where is fun in buying a ticket at a local convenience store and checking whether the numbers match the winning ticket? The only reason you buy the ticket is the hope that you may win big – there are no expectations. That is why you almost never read about people becoming addicted to the lottery.
Other Benefits of Lottery Jackpots –
In addition to providing a constantly positive utility to the buyer, lottery jackpots also help society in general. Most lotteries around the world provide huge money to the government in taxes. This money is used to improve roads, schools and other infrastructure.