Originally posted on Huffington Post Canada on January 28, 2016
By Neil Seeman
Founder/ CEO, The RIWI Corporation; Senior Fellow, Massey College
Blessed are those who do not buy Powerball tickets. So went the virtuous refrain of much of the media and punditocracy, smugly denouncing Powerballers as morons.
To Stony Brook University’s Noah Smith, writing in BloombergView, “lotteries, and lottery stocks, might be more than harmless fantasy. They might also be taking advantage of the cognitive illusions and biases of less-educated, less-well-informed individuals, making money for the government at these vulnerable people’s expense.”
Explaining the mind of a Powerballer, Tim Harford of the Financial Times tweeted agreement with economist Larry Summers’ famous adage that “There are idiots. Look around.” Yet Summers, who wrote this in the 1980s, was referring not to those who buy lottery tickets but to wizard hedge fund investors hoodwinked by other financial mavens.
Cognitive illusions and biases loom large in those who slur Powerballers.
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