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> Normal people can't parse probabilities - otherwise nobody would play in the lottery.

Yes, they would. The lottery is about giving up something of little value ($1 or $2) for some entertainment and the chance at a truly life-changing situation. I doubt anyone is unaware there's almost no chance they win, and that they're losing on every dollar they spend. Interestingly, the lottery is occasionally +EV to play.

I otherwise agree, people are bad at gambling, probabilities, and understanding the long term. I play poker, and poker players are constantly furious that their 80% favorite hand doesn't win 100% of the time. 80% feels like a lock.

Some people don't care. They want to gamble, and they have no regard for what they lose in the process. I think many humans are just wired this way, or perhaps it's cultural.

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> I play poker, and poker players are constantly furious that their 80% favorite hand doesn't win 100% of the time. 80% feels like a lock.

I always liked an interview by one of the designers of the game XCOM which relies heavily on showing players probabilities. Apparently behind the scenes on lower difficulties, even though they might show you 85% chance of success, they tweak it under the hood to be closer to 95% because that is where the player's emotional weighting is. They want the players to have fun and that is certainly one way to go about it.

https://www.gamasutra.com/view/news/266891/Jake_Solomon_expl...

Well because evolutionarily, gambling must pay off sometimes, and the people who are averse to gambling might become rarer if it pays off in a big way.

Ten thousand years ago doing something risky might result in you going from being a male with no prospects to having a harem with 50 wives. It makes sense that when your ancestors could have made a risky gambled (say raiding the village next door), they’d go for it, much like someone will put everything on 21 Black because the payoff could be so big.

But who gives a damn about the EEA?

That is not how evolution works. It can just be that the trait was not much in a way. Our that trait is innefective maladaption.

Evolution is not a god. And it does not build perfect organisms.

Or maybe it's just a trait that ended up there, like countless others.

A RNG machine that's slightly directed towards optimal variation still spews out a bunch of rubbish

I agree, playing the lottery is a little like buying insurance for something. Everyone knows that insurance is a losing proposition, but no one buys it to save 500$ on that fender bender, people buy it so that they can get through a catastrophic event like 500,000$ in medical bills.

I would hazard a guess that people who buy lottery tickets are much less likely to buy insurance than those who don't. I think some similar psychological mechanisms may be at play, but not in the way you are suggesting where they overestimate small probabilities across the board. I suspect it has more to do with discounting odds that are against them.

But I wouldn't bet on it.

A bit part of the lottery is that everyone knows that it's unlikely, but most people are capable of comprehending just how unlikely it is. Most people would probably say it's like "one-in-a-million", when it's really hundreds of times worse than that. People are just bad at understanding really big numbers. Everyone still feels like, "I know it won't, but it could happen to me," when even if you bought a lottery ticket every single week for your entire adult life, it would take you over a thousand lifetimes for you to finally have a 1% chance to win the lottery.

I think people at least initially have better grasps on things like 50-50 chances or 10% chances, even if other gambling fallacies kick in the more you play them.

1 in 140 million for EuroMillions

1 in 293 million for Powerball

Just because someone wins doesn't mean it will be you

> The lottery is about giving up something of little value ($1 or $2) for some entertainment and the chance at a truly life-changing situation

Wish that were true. Organizers usually take 90% of the money. Just a tiny percentage is paid out.

Like Voltaire said: "Lotteries are a tax on stupidity"

I agree, and I don't see how it contradicts what I said at all.

Except that wasn't Voltaire it was the economist Sir William Petty. In fact Voltaire made his fortune on the lottery. He found a exploit in the rules of the particular implementation of the lottery allowing him to guarantee a win and high pay out.

http://www.todayifoundout.com/index.php/2013/05/how-voiltair...

I've never had an urge to buy lottery tickets or gamble for money. Mathematically, I know the odds of me winning are highly unlikely so my non-urge turns further into complete disinterest, I can pass by lottery shops and rolls of scratch lottery cards in shops and not even notice them.

I've only been in one lottery and I was forced to enter against my wishes - that was the draft/conscription which, unfortunately, I did win - along with many others.

If I've an interest in lotteries/gambling then it's to question why I'm so disinterested in the subject compared to others. I've not been able to answer that adequately.

> Yes, they would. The lottery is about giving up something of little value ($1 or $2) for some entertainment and the chance at a truly life-changing situation.

It is expected that that one or two dollars is more likely to result in a life changing situation if saved and properly invested - this is difficult in the modern world since a lot of large institutions are out to short-change the little guys but it still remains true.

I can easily see the value proposition of regular casino gambling - you're slowly losing money for the experience - but for the lottery your money is being transformed into a ticket that is, essentially, worthless.

I am strongly morally opposed to the lottery as a form of government income supplement since spending on lotteries tends to be weighted toward lower income and is extracting revenue from those less able to bear it. Lotteries are an extremely regressive tax.

That all said I think the EV of a lottery ticket is probably quite a bit higher than Starbucks and those sell gangbusters. A lot of our society is oriented toward exploiting addiction.

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