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'Let me dream on!' Anticipatory Emotions and Preference for Timing in Lotteries

Author

Listed:
  • Martin Kocher

    (University of Munich)

  • Michal Krawczyk

    (Warsaw University)

  • Frans van Winden

    (CREED, University of Amsterdam)

Abstract

This discussion paper resulted in a publication in the 'Journal of Economic Behavior & Organization' , 2014, 98, 29-40. We analyze one of the explanations why people participate in lotteries. Our hypothesis stipulates that part of the value that a unit of money buys in lotteries is consumed before the actual resolution in the form of emotions such as hope. In other words, a person holding a lottery ticket may prefer a delayed resolution of risk due to positive anticipatory emotions. This conjecture is tested in an experiment with real lottery tickets. We show that our theoretical considerations may contribute to explaining empirical puzzles associated with lottery participation, timing of resolution and the spreading of drawings. More specifically, we find that a substantial number of participants prefer delayed resolution, that anticipated thrill is the main variable explaining this choice, that emotions actually experienced during the waiting period are indeed predominantly positive and correlated with predictions. Finally, we find that a great majority prefers to 'spread' chances, that is, to obtain one ticket for each of two drawings rather than two for the same drawing.

Suggested Citation

  • Martin Kocher & Michal Krawczyk & Frans van Winden, 2009. "'Let me dream on!' Anticipatory Emotions and Preference for Timing in Lotteries," Tinbergen Institute Discussion Papers 09-098/1, Tinbergen Institute.
  • Handle: RePEc:tin:wpaper:20090098
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    References listed on IDEAS

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    Cited by:

    1. Roman Kräussl & Ronald Bosman & Thomas van Galen, 2014. "Emotions-at-Risk: An Experimental Investigation into Emotions, Option Prices and Risk Perception," LSF Research Working Paper Series 14-11, Luxembourg School of Finance, University of Luxembourg.
    2. Falk, Armin & Zimmermann, Florian, 2016. "Beliefs and Utility: Experimental Evidence on Preferences for Information," IZA Discussion Papers 10172, Institute for the Study of Labor (IZA).
    3. Jieyao Ding, 2011. "What Numbers to Choose for My Lottery Ticket? Behavior Anomalies in the Chinese Online Lottery Market," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2011_23, Max Planck Institute for Research on Collective Goods.
    4. repec:eee:gamebe:v:109:y:2018:i:c:p:21-39 is not listed on IDEAS
    5. Juliane Zenker & Andreas Wagener & Sebastian Vollmer, 2014. "Better Knowledge Need Not Affect Behavior; A Randomized Evaluation on the Demand for Lottery Tickets in Rural Thailand," CID Working Papers 282, Center for International Development at Harvard University.

    More about this item

    Keywords

    lotteries; anticipation; experiment;

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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