Article

Subjective Relative Income and Lottery Ticket Purchases

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Abstract

Despite a return of only $.53 on the dollar, state lotteries are extremely popular, especially among the poor, who play the most but can least afford to play. In two experiments conducted with low-income participants, we examine how implicit comparisons with other income classes increase low-income individuals' desire to play the lottery. In Experiment 1, participants were more likely to purchase lottery tickets when they were primed to perceive that their own income was low relative to an implicit standard. In Experiment 2, participants purchased more tickets when they considered situations in which rich people or poor people receive advantages, implicitly highlighting the fact that everyone has an equal chance of winning the lottery. Copyright © 2007 John Wiley & Sons, Ltd.

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... For example, Houser et al. (2012) found that the perception of being treated unfairly increases an individual's propensity to cheat. Most importantly, however, it was demonstrated that a feeling of inequality or a personal relative deprivation makes people more likely to gamble and more likely to choose risky financial options (Callan et al. 2011;Haisley et al. 2008;Mishra et al. 2015;Payne et al. 2017). Although none of the studies examined the effects of being a victim of unfair treatment directly, they focused on the consequences of states which reflect the lack of fairness in the distribution of outcomes (i.e., distributive fairness; Colquitt et al. 2001). ...
... choices between sure and risky options). Other studies show that an experimentally induced feeling of personal relative deprivation (which is perceived as a key individual-level outcome of inequality, see: Smith et al. 2012) translates into gambling urges (Callan et al. 2011;Haisley et al. 2008). ...
... Previous studies allowed to expect that participants who were treated unfairly would be more prone to gamble. The existing literature showed that a feeling of inequality or personal relative deprivation in a financial domain makes people more prone to gamble (Callan et al. 2011;Haisley et al. 2008;Mishra et al. 2015;Payne et al. 2017). Nevertheless, this effect was not observed in our experiments when the experience of being treated unfairly was induced. ...
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Studies indicate that experiencing unfairness may influence subsequent decisions. There is initial evidence that this is also true for gambling decisions made after an experience of unfair treatment in a financial domain. The presented studies test whether this can be extended to other domains of financial risk-taking, such as investments. Moreover, we aim to investigate whether the effects of such experience in one domain generalize to other domains. Three experimental studies were conducted to investigate how unfair treatment coming from varied domains affects individuals’ propensities to make risky investment and gambling choices in subsequent tasks. The experience of being a victim or a beneficiary of unfair treatment in financial and non-financial domains was induced and the propensity to take investment and gambling risks was measured. The results of the experiments indicated that the experience of unfairness influences the propensity to make risky financial choices but the domain in which it is experienced plays an important role. Being a victim of financial unfairness makes people more prone to take investment risk and build riskier investing portfolios with more stocks and fewer bonds than when they are beneficiaries or when they are treated fairly. Moreover, being the beneficiary of unfair treatment in a financial domain makes people less prone to choose a sure option (vs risky) in lottery tasks. The abovementioned relationships are exactly the opposite when the experience of (un)fairness comes from a task in a non-financial context. Specifically, the experience of unfair treatment in a non-financial domain leads people to be less prone to make risky investment choices, and it enhances the propensity to build safer investment portfolios with more bonds and fewer stocks than people from the unfair-beneficiary and fair groups. Furthermore, being the beneficiary of unfair treatment in a non-financial context makes people more prone to choose sure option in lottery task.
... Personal relative deprivation, or more broadly, financial deprivation, can be described as feelings of having fewer monetary resources, especially when compared to others (Moeini-Jazani et al., 2019). People who have been made to feel as if they have fewer financial resources have been shown to consume more calorie-dense food (Briers and Laporte, 2013), purchase more lottery tickets (Haisley et al., 2008), and save less, all arguably present-oriented behaviors (Shah et al., 2012). Lower income is associated with greater risk aversion and elevated delay discounting (Green et al., 1996;Haushofer and Fehr, 2014). ...
... Van den Bergh et al. (2008; Study 3, control group only 1 ) manipulated the scale in which participants reported their income and Moeini-Jazani et al. (2019; Study 2, control group only 2 ) used versions of both methods with each participant. The scale manipulation method has been established as an effective way to induce feelings of financial deprivation and has been shown to affect performance in other tasks (e.g., Haisley et al., 2008;Briers and Laporte, 2013). Moeini-Jazani et al. ...
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Delay discounting, the tendency for outcomes to be devalued as they are more temporally remote, has implications as a target for behavioral interventions. Because of these implications, it is important to understand how different states individuals may face, such as deprivation, influence the degree of delay discounting. Both dual systems models and state-trait views of delay discounting assume that deprivation may result in steeper delay discounting. Despite early inconsistencies and mixed results, researchers have sometimes asserted that deprivation increases delay discounting, with few qualifications. The aim of this review was to determine what empirical effect, if any, deprivation has on delay discounting. We considered many kinds of deprivation, such as deprivation from sleep, drugs, and food in humans and non-human animals. For 23 studies, we analyzed the effect of deprivation on delay discounting by computing effect sizes for the difference between delay discounting in a control, or baseline, condition and delay discounting in a deprived state. We discuss these 23 studies and other relevant studies found in our search in a narrative review. Overall, we found mixed effects of deprivation on delay discounting. The effect may depend on what type of deprivation participants faced. Effect sizes for deprivation types ranged from small for sleep deprivation (Hedge's g s between −0.21 and 0.07) to large for opiate deprivation (Hedge's g s between 0.42 and 1.72). We discuss possible reasons why the effect of deprivation on delay discounting may depend on deprivation type, including the use of imagined manipulations and deprivation intensity. The inconsistency in results across studies, even when comparing within the same type of deprivation, indicates that more experiments are needed to reach a consensus on the effects of deprivation on delay discounting. A basic understanding of how states affect delay discounting may inform translational efforts.
... Ours is comprised of small low-income entrepreneurs in a developing country. There is ample evidence suggesting that individuals in poverty are more prone to seek risks in a variety of domains, such as in decisions to borrow at high interest rates (Bertrand, Morse, Bertrand, & Morse, 2011;Dobbie & Skiba, 2013), to gamble at unfavorable odds and play the lottery (Haisley, Mostafa, & Loewenstein, 2008), or to make risky health choices (Cutler & Lleras-Muney, 2010;Lynch, Kaplan, & Salonen, 1997;Marmot et al., 1991). This paper shows that financial worries associated with poverty may be one of the potential mechanisms explaining lower risk aversion under poverty. ...
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We randomly expose the owners of small retail businesses in Vietnam to scenarios that trigger financial worries and study the effect of this intervention on risk attitudes using an incentive-compatible elicitation method. We find that entrepreneurs exposed to financial worries behave less risk-averse than those assigned to a placebo treatment. This effect is stronger for owners of shops which are smaller and those less exposed to large income shocks in their everyday business. We further show that the effect of financial worries on risk attitudes is not explained by changes in the cognitive functioning of the treated. The findings are consistent with previous results from laboratory experiments with students in developed countries. As such, the paper provides evidence for the external validity of these findings in the context of micro-entrepreneurship in a developing country and points to financial worries as one understudied psychological channel for the effect of material deprivation on decision-making.
... In addition, prior research suggests that if people were to engage in downward comparisons, inequality would not produce changes in their risk appetite . Indeed, only upward-comparisons create a sense of unfair inferiority, which drives risky behaviors (Haisley et al. 2008;Mishra et al. 2015). Such comparisons represent in people's (and monkeys', see Brosnan and de Waal 2003) minds a strong disadvantage. ...
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Technology-Mediated Dangerous Behaviors (TMDBs), such as posting selfies while driving or posting private information, are prevalent and require possible interventions. Knowledge about their drivers, and specifically the role of information in stimulating such behaviors, is limited. To address this gap, I turn to foraging and risk-sensitivity theories. These theories suggest that animals engage in more dangerous behaviors when their perceived need for calories is high. Similarly, humans increase their financial risk-taking when sensing dissatisfaction with what they have. Importantly, inequality information can increase such perceptions and change people's risk-taking propensity. Adapting these ideas, I posit that TMDBs resemble food-seeking in animals in that they (1) are goal-oriented, (2) can be dangerous, and (3) yield unknown (probabilistic) rewards. Therefore, I explain TMDBs from foraging and risk-sensitivity theory angles. Focusing on social media users (Studies 1-4; four experiments; total n= 2,504), I argue that (1) it is reasonable to view users as foraging the "fields of social media" for social-hedonic rewards, (2) it is possible to alter their risk appetite and TMDBs through inequality information and upward comparison mechanisms, (3) this process can be mediated not only through cognitions, but also emotions, and (4) perceived scarcity of rewards and social comparison orientation affect this process. I next extend the core aspects of this theory to the state-level in Study 5. I argue that objective financial inequality can explain differences between US states in TMDBs such as texting while driving and relative interest in TMDBs, such as pranks. The findings largely support these assertions. They illuminate the role of information, notably inequality, in driving TMDBs, extend prior research that has focused on basic needs (e.g., physiological needs in the case of food intake decisions) to the case of higher-order human needs (e.g., needs for belonging, esteem, and self-actualization) as catered to by non-physiological, social-hedonic rewards, and point to important mechanisms that translate inequality into TMDBs.
... Some papers that discuss the many views on the causes of poverty and ways to improve decision making include Spilerman and Elesh (1971), Salling and Harvey (1981), Kane (1987), Douglas Bernheim et al. (2001), Cleaver (2005), Bertrand et al. (2006), Haisley et al. (2008a), Reutter et al. (2009), and Martin and Hill (2011). Other research that studies how scarcity (of time and money) can affect how individuals perceive value and decision problems includes Karau and Kelly (1992), Perlow (1999), Haisley et al. (2008b), Shah et al. (2018a), Mani et al. (2013), Haushofer and Fehr (2014), Hall et al. (2014), Sharma et al. (2014), Shah et al. (2015), Shah (2016) and Shah et al. , 2018b. This is a non-extensive list of papers on the subject and naturally some overlap. ...
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Individual choices are often inconsistent with economic theories, which has motivated a variety of ways to measure how far choices are from a given theory. Recent work has investigated the correlation between “measures of rationality” and observable information such as education or income. This paper investigates the sensitivity of this analysis to the units used to measure rationality, in particular we examine measures in percentage expenditure vs dollars expenditure. We find that correlations can change sign when we change the units, but this sensitivity might be mitigated with experimental methods.
... Our relative poverty prime is a variation of that used by Haisley et al. (2008b) to study the decision to participate in lotteries. Mo (2012Mo ( , 2018 first employed this design to study the effects of perceived relative deprivation on political and economic behavior, and both Fair et al. (2016) and Healy et al. (2017) replicated that design in Pakistan. ...
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How do perceptions of one’s relative economic status affect gender attitudes, including support for women’s economic participation and involvement in decision-making in their community and household? We conducted a 2018 survey experiment with female and male adults in approximately 1000 households in Papua New Guinea. Employing an established survey treatment to subtly alter respondents’ perception of their relative economic wellbeing, we find that increased feelings of relative deprivation make both men and women significantly more likely to support girls’ schooling and women’s paid employment, suggesting that relative economic insecurity can actually prompt support for women’s economic participation. However, increased feelings of relative deprivation may trigger greater intra-household tension. While increased perceptions of relative deprivation cause women to want more household decision-making authority, men’s attitudes toward women’s proper roles in decision-making are unchanged. In other words, increased support for women’s economic participation among men appears to stem mainly from a desire to raise household income, and not to alter the general role of women in society. The results underscore the multifaceted nature of gender attitudes, and how support for women’s economic participation may rise without simultaneous increases in women’s agency in decision-making.
... Gambling in this case means a large probability of a subjectively small loss but a small probability of a very large gain. Such reasoning could also help to explain the data by Haisley et al. (2008) who show that, when reminded of their low status, low income individuals were more likely to engage in risky purchases such as buying lottery tickets. It is also the reasoning of Schwerter (2013), indicating that decision-makers indeed experience social losses and gains in a risk task when exposed to another participant receiving a varying fixed payment. ...
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Decisions under risk are often embedded in a social context that we usually abstract from when studying decision-making in the laboratory. In contrast to that practice, our experiment investigates whether risk-taking is affected by social comparisons. In particular, we focus on situations where some amount of money has to be allocated to two parties: either the amount can be shared, or a random device allocates the entire amount to one of the parties. We find that the social context of the decision matters strongly: When participants are in a disadvantageous initial position compared to the other party, they select the risky option much more often than in a purely individual decision, identical in all other respects. Overall, we find that individuals are relatively more risk-seeking in the socially unfavorable domain than in isolation, in contrast to the favorable one, where we find no or little change in elicited risk attitudes in comparison to an isolated decision.
... The literature on poverty and decision making suggests that people with low relative incomes and education levels may engage in conspicuous consumption behavior to compensate for their lower social status (Veblen, 1899). As an example related to gambling behavior, Haisley et al. (2008) find that lotteries are more attractive to low income households because they provide the rare opportunity to substantially increase their wealth and social status in a short period. Moreover, from a different perspective on social comparison mechanisms, a recent gambling experiment finds that people with higher incomes take higher risks than people with lower incomes, but only if the inequality in relative income levels is known to the participants (Schmidt et al., 2019). ...
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We conduct a lottery experiment to assess the predictive importance of simple choice process met-rics (SCPMs) in forecasting risky 50/50 gambling decisions using different types of machine learning algorithms as well as traditional choice modeling approaches. The SCPMs are recorded during a fixed pre-decision phase and are derived from tracking subjects' eye movements, pupil sizes, skin conductance, and cardiovas-cular and respiratory signals. Our study demonstrates that SCPMs provide relevant information for predicting gambling decisions, but we do not find forecasting accuracy to be substantially affected by adding SCPMs to standard choice data. Instead, our results show that forecasting accuracy highly depends on differences in subject-specific risk preferences and is largely driven by including information on lottery design variables. As a key result, we find evidence for dynamic changes in the predictive importance of psychophysiological responses that appear to be linked to habituation and resource-depletion effects. Subjects' willingness to gamble and choice-revealing arousal signals both decrease as the experiment progresses. Moreover, our findings highlight the importance of accounting for previous lottery payoff characteristics when investigating the role of emotions and cognitive bias in repeated decision-making scenarios.
... This measure was taken at the beginning of the survey along with age and gender. A free-text box was used to avoid unintentional priming effects that could be elicited by using income brackets (Haisley, Mostafa, & Loewenstein, 2008 PrePrints effects. They were asked to rate their agreement on a scale from one (strongly disagree) to seven (strongly agree) with the statements: a) "I don't worry too much about paying my bills"; b) "I have enough money to buy things I want", and; c) "I don't think I'll have to worry about money too much in the future." ...
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Socioeconomic gradients in health behaviour are pervasive and well documented. Yet, there is little consensus on their causes. Behavioural ecological theory predicts that, if people of lower socioeconomic position (SEP) perceive greater personal extrinsic mortality risk than those of higher SEP, they should disinvest in their future health. We surveyed North American adults for reported effort in looking after health, perceived extrinsic and intrinsic mortality risks, and measures of SEP. We examined the relationships between these variables and found that lower subjective SEP predicted lower reported health effort. Lower subjective SEP was also associated with higher perceived extrinsic mortality risk, which in turn predicted lower reported health effort. The effect of subjective SEP on reported health effort was completely mediated by perceived extrinsic mortality risk. Our findings indicate that perceived extrinsic mortality risk may be a key factor underlying SEP gradients in motivation to invest in future health.
... Moreover, consumers consider not only their overall wealth, but also their relative status. When low socioeconomic status is made salient, people are more likely to engage in behaviors with high risk and low returns (Haisley, Mostafa, & Loewenstein, 2008). In one experiment, when low-income individuals were primed to perceive their own income as low relative to an implicit standard, they were more likely to purchase lottery tickets. ...
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Financial decisions can have lasting consequences for consumer welfare and other important decisions. This review summarizes contemporary literature on financial decision making vis‐à‐vis the promotion of financial well‐being, outlining work on financial behaviors that contribute to financial well‐being, psychosocial determinants of financial well‐being, and the role of situational factors in financial well‐being. In addition to reviewing recent research, this article draws attention to some open questions in the field and proposes a trajectory for productive pathways of future research.
... Our main contribution is that we link positional preferences to voluntary risk-taking with high stakes for an increasingly popular leisure activity -backcountry skiing. A small number of previous studies have analysed the link between positional preferences and risk-taking behaviour (Friehe & Mechtel, 2017;Haisley & Loewenstein, 2008). However, these studies focus on financial risk with relatively small stakes. ...
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We test if positionality, i.e., the desire to gain social status, is associated with an increased willingness to take risk among backcountry riders. If positional preferences drive risk-taking behaviour in avalanche terrain, this is especially problematic because the stakes are high and can be fatal. Our analysis is based on data for hypothetical choices from an online survey (N = 648) in North America. We find that positional riders are significantly more likely to boast about riding bold lines, more likely to associate steep riding with social respect, and more likely to say that they would accept to ride a potentially risky line. The positionality effect is present regardless of level of avalanche training. We discuss implications for avalanche training and education.
... Kemiskinan absolut didasarkan pada pendapatan sebenarnya yang diperoleh individu dimana apabila berada di bawah garis ukur tertentu maka yang bersangkutan dapat dikategorikan miskin (Bergh & Nilsson, 2014). Sementara kemiskinan relatif didasarkan pada perbandingan pendapatan individu dengan atas pendapatan lingkungan sekitar sehingga kemiskinan ini bersifat relatif atau relative income poverty (Burtless & Smeeding, 2001;Haisley, Mostafa, & Loewenstein, 2008). ...
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Penelitian ini bertujuan untuk mengembangkan konsep kemiskinan subjektif dan menguji indikator-indikatornya. Untuk itu, penelitian dengan pendekatan Psikologi Indigenous ini dilakukan melalui dua tahap studi. Total sampel penelitian ini sebanyak 283 responden, terdiri dari 148 responden dalam Studi 1 dan 135 responden dalam Studi 2. Pengumpulan data Studi 1 dengan kuesioner pertanyaan terbuka dan analisis data menggunakan teknik analisis isi, sedangkan pengumpulan data Studi 2 dengan Skala Kemiskinan Subjektif yang disusun berdasarkan temuan Studi 1. Teknik Analisis Faktor Eksploratori dilakukan untuk menemukan indikator-indikator dari dimensi kemiskinan subjektif. Hasil Studi 1 menunjukkan bahwa kemiskinan subjektif pada mahasiswa merepresentasikan adanya perasaan dan/atau pemikiran yang menilai dirinya berada dalam keterbatasan material, spiritual, intelektual, emosional, dan relasional. Hasil Studi 2 membuktikan indikator perilaku dalam aspek kemiskinan subjektif yang dihasilkan pada Studi 1 sebelumnya terbukti mampu menjelaskan konstruk kemiskinan subjektif.
... To study the social interdependence of investment decisions, we use an investment task based on Gneezy and Potters (1999), where each subject needs to decide how much of their endowment they wish to allocate in an asset to which there is a 50% chance the amount they invest will be tripled and a 50% chance their investment will be lost. We implement a 2 x 2 factorial design in which we vary: (i) whether information about the investment decisions of other subjects in their social group is 1 See Boles and Messick (1995), Zizzo (2001), Bault et al. (2008), Delgado et al. (2008), Haisley et al. (2008), Hill and Buss (2010), Cooper and Rege (2011), Rohde and Rohde (2011), Viscusi et al. (2011), Linde and Sonnemans (2012), Dijk et al. (2014), Friedl et al. (2014), Kuziemko et al. (2014), Mishra et al. (2014Mishra et al. ( , 2015, Fafchamps et al. (2015), Lahno and Serra-Garcia (2015), Schwerter (2015), Brookins et al. (2016), Chao et al. (2017), Gamba et al. (2017), Gioia (2017), Xie et al. (2017), Gantner and Kerschbamer (2018), Lopera and Marchand (2018), Mitton et al. (2018), Gortner and van der Weele (2019), Müller and Rau (2019), Schmidt et al. (2019), Hildenbrandt and Steinorth (2020) and Gill et al. (2020). Trautmann and Vieider (2012) is an early review of the literature. 2 As well as possibly others, such as enhanced group identity (see Gioia, 2017) and competitive preferences (e.g., Bault et al., 2008;Fafchamps et al., 2015;Kebede and Zizzo, 2015) against Wall Street hedge funds. ...
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We report the results of an economic experiment on how social preferences and behavioral imitation lead to the social clustering of investment decisions, even if the expected return of the underlying asset is known. During the experiment, subjects are asked how much of their endowment they wish to allocate in an asset to which there is a 50% chance the amount they invest will be tripled and a 50% chance their investment will be lost. To study the social interdependence of investment decisions we use a 2 x 2 factorial design varying: (i) whether the subjects initially observed high or low investment social anchors, (ii) whether information about the investment decisions of other subjects in their social group is provided. Overall, we find strong evidence that individuals' investment decisions are malleable to the investment decisions of their peers, which in turn leads to the social clustering of investment decisions. Furthermore, social anchors shape initial investment levels, leading to mean investment rates that are double in size in the high anchor treatment relative to the low anchor treatment.
... While there is research on who is playing state-lotteries and why (see e.g. [43][44][45][46]) little is known whether specific properties of charity lotteries influence the player to make higher donations, i.e. to buy larger shares. ...
Article
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To investigate how neediness and identifiability of a recipient influence the willingness of a donor to invest resources in charity-like lotteries we propose a new game, called ‘need game’. Similar to the dictator game, the need game includes two players, one active player (the donor or dictator) and one passive player (the recipient). Both players require a minimum need (ND and NR), expressed in terms of points. The donor is endowed with KD points and must retain at least ND points, i.e., the need, with ND < KD, at the end of the game with n rounds. The recipient starts with KR points and must end the game with at least NR points, i.e., the need, with KR < NR < KD. The donor is asked to choose one of three different amounts from KD to place a bet on a lottery. If won, the gain is added to the endowment. If lost, the recipient receives the points. The recipient is paid only when his/her need threshold is obtained; likewise the donor gets paid only when his/her need threshold is maintained. The main focus here is on need of both players (ND = NR = 2, 200, and ND = NR = 0 serving as baseline control) and the identifiability of the recipient (no information, described by text and picture, and physical presence). We probe whether the amount invested by the donor depends on need and identifiability of the recipient. In addition, we include the framing of the game as gain or loss, different probabilities to win/lose, and different time limits as covariates. We found that each of these factors can play a role when investing in charity-like lotteries.
... State lotteries are an important source of revenue for state budgets, yet it is well documented that state lotteries are regressive (Price and Novak 2000;Combs, Kim, and Spry 2008) and appeal to low-income households (Haisley, Mostafa, and Loewenstein 2008;Blalock, Just, and Simon 2007). While lotteries are also a common form of entertainment (and possibly investment) for households, lotteries cannot substitute for food or other necessary goods and services. ...
Article
The retail sector is one of constant innovation, where retailers relentlessly compete for customers by providing new products, better service, and attractive prices. At the same time, regulators must keep pace with these innovations to ensure that markets are fair and consumers are protected. This dissertation is composed of three chapters that examine the interactions of consumer behavior and retail regulation. The first chapter examines how bulk buying varies by household income and analyzes the factors that affect a household's bulk buying decision. Using reduced-form methods and detailed household-level purchase data, I show that many factors, including the cognitive costs of computing unit prices, store preferences, storage costs, and budget constraints, affect a household's bulk buying. I then estimate a discrete-choice model that incorporates cognitive costs and storage costs and find that mandating the display of unit prices would substantially increase bulk buying and lower the unit prices paid by households, especially low-income households. The second chapter studies how imposing sales taxes on previously tax-free online purchases affects household shopping behavior. Historically, e-commerce was an easy way for consumers to avoid sales taxes, but over the past decade, online retailers were required to collect sales taxes, negating the structural price advantage they had. Using detailed online shopping and browsing data, I find that in response to sales tax collection, households reduce their spending at taxed online retailers, but find no evidence that households change their search behavior or offline shopping expenditures. The third chapter analyzes whether welfare transfers are linked to lottery gambling. A minority of lottery retailers are eligible to accept Supplemental Nutrition Assistance Program (SNAP) benefits, but these stores account for a majority of lottery sales. By combining novel data on store-level lottery sales with a range of policy shocks to the SNAP program, this chapter finds that SNAP benefits decrease lottery gambling, likely by decreasing shopping frequency, and therefore, the number of lottery gambling opportunities.
... Participants were first randomly assigned to either the financial constraints or the no financial constraints condition, manipulated as in previous research (Briers and Laporte 2013;Haisley, Mostafa, and Loewenstein 2008;Nelson and Morrison 2005). Participants indicated the combined amount of money in their checking and savings accounts on 9-point scales. ...
Article
Many people experience financial constraints in their lives that affect their well-being and behaviors. This raises the question of whether individuals’ financial constraints will affect their responses to positive approach-framed (vs. negative avoidance-framed) messages in ads. We examined the effects of consumers’ financial constraints on their responses to ads that had positive approach-framed (vs. negative avoidance-framed) messages. We hypothesized that consumers with financial constraints would have more positive responses to an ad that had a positive approach-framed (vs. a negative avoidance-framed) message and that the depth of information processing would mediate their responses to an ad that had a positive approach-framed message. Across six studies, including field and online experiments, these findings supported the predictions. The findings advance the literature on both message framing in ads and financial constraints, and they generate actionable guidelines for marketing practice and public policy.
... Research by Beckert and Lutter (2013) found that selfperceived social deprivation strongly influences one's likelihood to play lottery. Similarly, in an experimental design, Haisley, Mostafa, and Loewenstein (2008) primed participants to feel that they received either a high or low income, and those who felt they had lower income spent significantly more on lottery tickets than those primed to feel they had a higher income. Those primed to believe their income was low spent more on lottery tickets because they believed their chances of winning were equal to everyone else. ...
Article
Previous studies have suggested that problem gambling is associated with various deviant outcomes. Little research, however, has considered the extent to which such relationships vary by subgroups of the population. Using data from the National Longitudinal Study of Adolescent to Adult Health (N = 9,644), this study examines the relationship between problem gambling in young adulthood and a range of deviant behaviors (i.e. binge drinking, marijuana use, instrumental crime, violent crime) and whether these relationships vary by family social class background. Results from logistic regressions reveal that problem gamblers have increased odds of engaging in weekly binge drinking, weekly marijuana use, and any instrumental crime. Furthermore, findings show that the relationship between problem gambling and weekly binge drinking is stronger for those from higher family social class backgrounds, but that the relationship between problem gambling and instrumental crime is stronger for those from lower family social class backgrounds. Implications of these findings are discussed.
... Card et al. 2012, Clark & Oswald 1996 and choice under risk (e.g. Friedl et al. 2014, Gamba et al. 2017, Haisley et al. 2008, Lahno & Serra-Garcia 2015, Linde & Sonnemans 2012, Rohde & Rohde 2011, Schwerter 2019. ...
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Using a laboratory experiment we examine how social comparisons affect behavior in a sequential search task. In a control treatment subjects search in isolation, while in two other treatments subjects get feedback on the search decisions and outcomes of a partner subject. The average level and rate of decline of reservation wages are similar across treatments. Nevertheless, subjects who are able to make social comparisons search differently from those who search in isolation. Within a search task we observe a reference wage effect: when a partner exits, the subject chooses a new reservation wage which is increasing in partner income. We also observe a social comparison effect between search tasks: subjects whose partners in a previous task searched for longer choose a higher reservation wage in the next task. Our findings imply that the provision of social information can change job-seekers search behavior.
... As to the reason why low-income people gamble, although no definite answers have yet been provided (Ariyabuddhiphongs 2011), experimental studies found both that lotteries are more attractive for poor people because they provide an opportunity to correct for low-income status, and that part of their appeal is that they are one of the few opportunities available to the poor for a sudden increase in wealth (Haisley et al. 2008). In this framework, gambling may act as a mean for coping with the discrepancy between the desired socio-economic status and the few options viable of achieving it via traditional channels (i.e., savings). ...
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In this paper we document the income-related inequality in gambling. We employ a novel database from 2014–2017 waves of the Italian Population Survey on Alcohol and other Drugs (IPSAD) which also include information on the preferences for games of chance. Following the Erryegers Index, our findings suggest that traditional lotteries are concentrated among the richest individuals, while betting and new generation games tend to be pro-poor games. The decomposition of income-related inequalities reveals that pro-rich inequality observed in traditional games is mainly driven by gender, age, and working condition. Higher components of the pro-poor inequality observed in betting and new generation games come instead from income and age. Since the pro-poor games are also the major contributors of the growth in gambling turnover and the increase in gambling disorders, our results indicate that a relevant part of increasing social costs associated to gambling are more likely to be paid by the less-well off, and potentially most vulnerable members of the society.
... In addition, from a behavioral decision perspective, incomes of comparable peers help establish a reference point, putting a focal individual in a gain or loss frame through social comparison (Tversky & Kahneman, 1991). Some studies suggest that such a socially informed reference point operates in a same fashion as a typical reference point: people become more risk-seeking when they perform below it, and more risk-averse when performing above it (Haisley, Mostafa, & Loewenstein, 2008;Wang et al., 2016). Yet, other studies document that people are more risk-seeking when performing above social reference point (Fox & Dayan, 2004;Linde & Sonnemans, 2012). ...
... Faced with resource scarcity, consumers exhibit various responses including narrowed attention, focusing on oneself and less attention to the needs of others (Shah et al. 2012). Previous research further suggests that people with fewer resources engage in suboptimal behavior, such as excessive lottery purchases (Haisley et al. 2008). Broadly speaking, these patterns of suboptimal behavior may pertain to ethical issues. ...
... Perceived relative deprivation (the extent to which one feels deprived compared with peers) has been linked with problem gambling and urge to gamble (Callan et al., 2015), alongside other negative physical and mental health outcomes (Smith et al., 2012). Furthermore, experimental manipulations to enhance perceived relative deprivation increased likelihood of purchasing lottery tickets (Haisley et al., 2008). Income inequality (rather than regional wealth) appears to be particularly predictive -possibly due to 'intensification of societal class competition' (Canale et al., 2017, p. 2). ...
Article
The link between gambling and deprivation is well recognized both in the UK and internationally; and manipulating perceptions of relative deprivation can encourage people to gamble. The current study sought to learn more about whether individuals who gamble consciously perceive themselves to be motivated by feelings of deprivation, and how this is contextualized alongside monetary factors more broadly. Thematic analysis was conducted on 25 in-depth qualitative interviews with UK residents who gamble regularly; most of whom resided in areas of high socio-economic deprivation. Monetary themes relating to financial circumstances, the meaning and value of money, and the perception of gambling as a way to make money, all had strong relevance for deprivation, though people did not often endorse the idea that relative deprivation was important to them, per se. We conclude that gambling motivations are complex and heterogeneous, and that it is pertinent for prevention and intervention strategies for problem gambling to consider individuals’ financial circumstances and how they perceive them, along with how this intersects with their gambling motives.
... A growing body of research has shown that SES affects many aspects of individuals' lives, such as their cognitive performance (Nisbett 2009), health (Smith 1999), subjective well-being (Daly, Wilson, and Johnson 2013), and impulsivity (Haisley, Mostafa, and Loewenstein 2008). Childhood SES often better predicts adult behavior than current SES because childhood experiences shape individuals' patterns of responses to their environments (Griskevicius et al. 2011;Thompson, Hamilton, and Banerji 2020). ...
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The present research investigates a novel relationship between travelers’ childhood socioeconomic status (SES) and travel decision-making. We theorize that travelers from lower childhood SES or resource-scarce/unpredictable environments are more likely to avoid extreme options in a choice set. Five studies consistently show that childhood SES is negatively associated with extremeness aversion in diverse travel choices. We also demonstrate that the general risk tendency mediates the relationship between childhood SES and extremeness aversion in travel decision making (studies 3A and 3B). Lastly, we reveal that childhood SES is more likely to predict extremeness aversion when a choice set involves a quality–price trade-off rather than a quality–quality trade-off (study 4). This research introduces evolutionary aspects to explain pervasive behavioral tendencies in the context of travel and tourism and offers new insights to practitioners.
... Inspired by work on social comparison processes (Festinger, 1954;Wheeler & Miyake, 1992), personal relative deprivation has been conceptualized as a two-step process: an initial cognitive assessment that one has been personally disadvantaged relative to a comparison target, and a subsequent negative affective reaction that includes anger, resentment, and dissatisfaction with one's outcomes (Callan et al., 2008;Haisley et al., 2008;Smith et al., 2012). This experience of relative deprivation has been associated with various physical and psychological consequences, including heightened stress, poor mental health, and lower subjective wellbeing (Eibner & Evans, 2005;Ellaway et al., 2004;Luttmer, 2005;Pham-Kanter, 2009;Walker & Mann, 1987). ...
Article
Why do people view economic success as zero-sum? In seven studies (including a large, nationally representative sample of more than 90,000 respondents from 60 countries), we explore how personal relative deprivation influences zero-sum thinking-the belief that one person's gains can only be obtained at other people's expense. We find that personal relative deprivation fosters a belief that economic success is zero-sum, and that this is true regardless of participants' household income, political ideology, or subjective social class. Moreover, in a large and preregistered study, we find that the effect of personal relative deprivation on zero-sum thinking is mediated by lay perceptions of society. The more people see themselves as having been unfairly disadvantaged relative to others, the more they view the world as unjust and economic success as determined by external forces beyond one's control. In turn, these cynical views of society lead people to believe that economic success is zero-sum. We discuss the implications of these findings for research on social comparisons, the distribution of resources, and the psychological consequences of feeling personally deprived. (PsycInfo Database Record (c) 2021 APA, all rights reserved).
... Some notable exceptions are Ahern et al. (2014), Balsa et al. (2015) and Browne et al. (2020), who, using survey data, show that peer influence on risk-taking is significant, widespread, and differs significantly based on the context and the demographic characteristics of the sample population. However, due to the inherent limitations of survey data, they are not tailored for identifying the behavioural mechanisms that underpin the observed peer effects. 2 Economic experiments allow researchers greater control over the settings within which behaviour is studied, and several recent experimental studies have attempted to shed light on the interplay between 1 See Boles and Messick (1995), Zizzo (2001), Bault et al. (2008), Delgado et al. (2008), Haisley et al. (2008), Hill and Buss (2010), Cooper and Rege (2011), Rohde and Rohde (2011), Viscusi et al. (2011), Linde and Sonnemans (2012), Dijk et al. (2014, Kuziemko et al. (2014), Mishra et al. (2014Mishra et al. ( , 2015, Fafchamps et al. (2015), Lahno and Serra-Garcia (2015), Schwerter (2015), Brookins et al. (2016), Chao et al. (2017), Gamba et al. (2017), Gioia (2017), Gantner and Kerschbamer (2018), Lopera and Marchand (2018), Gortner and van der Weele (2019), Müller and Rau (2019), Schmidt et al. (2019), Hildenbrandt and Steinorth (2020), Gill et al. (2020) and Karakostas et al. (2021). 2 See Nakamura et al. (2017) for a more general discussion of this point, in the context of studies of peer effect studies related to unhealthy behaviors. risk and social preferences. ...
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We present an experiment providing (a) a horse race among different models combining social preferences and risk preferences, and (b) a test of whether agents are socially curious, that is wanting to know about the risk taking of others and the outcomes of their risk taking. We distinguish outcome driven models (that is, models where agents care about the earning outcomes for themselves and others) from action driven models (that is, models where agents care about one's risk taking actions relative to the actions of others). We embed outcome and action driven competitive preferences, inequality aversion, conformism, and social loss aversion, within a single general theoretical framework. We find that competitive preferences models best explain investment decisions in our setting, with almost 50% of subjects influenced both by their co-participants' actions and outcomes. About 90% of subjects seek social information when it is free. When it is costly, 30% of subjects seek social information if the information is instrumental for their own investment decision and about 15% seek social information even if it is not. Competitive preferences can help explain social curiosity. JEL Classification: C91, D81, D91, G11, G22.
... We chose to ask respondents about their personal income rather than their household overall income because Micklewright and Schnepf (2010) have shown that questions about household income induce lower response rates and produce lower quality data. Participants were asked to report their personal monthly income in a free-text box, in order to avoid unintentional priming effects that can arise with the use of income brackets (Haisley, Mostafa and Loewenstein, 2008). Participants were asked to report their level of education on a 6-point scale. ...
Thesis
The works compiled in this thesis are concrete examples of how methods, insights and evidence from behavioural science and economics could enlighten policy makers wishing to understand and reinforce pro-environmentalism. The 1st part is an application of methods and insights from psychology to environmental public policy and is the product of a collaboration with policy makers in the French Parisian region, to tackle two polluting behaviours: littering and household combustion. The 1st chapter shows how laboratory experiments using psychometric methods from vision research could be crucial to inform policy makers on how to maximise the effectiveness of littering interventions, by quantifying the increase in visual salience following a change in the colour of trash bins in an urban setting. The 2nd chapter, using a field experimental setting, shows that while information provision is not enough to change household combustion behaviour, increasing the salience of indoor pollution by combining feedback provision and social comparison is effective in changing behaviour and decreasing indoor air pollution. The 2nd part of this thesis examines the relationship between socioeconomic status and the psychological mechanisms underlying pro-environmentalism and behavioural interventions. The 3rd chapter shows that the positive association between socioeconomic status and pro-environmental attitudes is partially mediated by individual time preferences. Chapter 4 is a short review suggesting that socioeconomic backgrounds could moderate the effectiveness of popular environmental behavioural interventions that leverage on biases likely to be heterogeneous across income groups.
... This comparative process is similar to that used in many other forms of self-evaluations (Higgins et al., 1986). It is also consistent with research showing that assessments of money are typically comparative in nature (Hsee et al., 2009), as well as several lines of research that suggest that subjective wealth is not solely based on the absolute value of consumers' finances but is in large part based on relative comparisons (e.g., Clark & Oswald, 1996;Crawford Solberg et al., 2002;Haisley et al., 2008). Accordingly, we speculate that this route may be the most common and dedicate most attention to understanding how consumers assess their finances through this Financial constraints "The extent to which people believe that their financial situation restricts desired consumption" Tully et al. (2015) Financial deprivation "An unpleasant psychological state in which consumers feel financially 'inferior' or 'worse off' relative to a salient comparison standard because they perceive a deficit in their financial resources" Sharma and Alter (2012) Financial satisfaction "Satisfaction with one's present financial situation" Joo and Grable (2004) [Financial] scarcity "A subjective sense of having more needs than [financial] resources" Mullainathan and Shafir (2013) Financial slack "The perceived surplus of a given resource available to complete a focal task without causing failure to achieve goals associated with competing uses of the same resource" Zauberman and Lynch (2005) Financial well-being "A state of being wherein you have control over day-to-day, month-to-month finances; have the capacity to absorb financial shock; are on track to meet your financial goals; and have the financial freedom to make the choices that allow you to enjoy life" ...
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This article focuses on understanding the meaning of consumer wealth. Research on consumer wealth uses a variety of terminology, including but not limited to economic recessions, financial constraints, financial deprivation, financial satisfaction, financial scarcity, financial well‐being, income, poverty, slack, socio‐economic status (SES), subjective SES, and subjective wealth. We first review and integrate multiple streams of research to provide a discussion on the conceptualization and measurement of objective wealth (i.e., consumers' actual financial resource levels) and subjective wealth (i.e., subjective assessments of consumers' financial resource levels). We then propose an organizing framework that explains the process by which consumers construct subjective wealth perceptions, identifying different routes that can be employed, as well as common cognitive and affective responses that operate across routes to shape final assessments. This framework provides greater understanding of why subjective wealth often diverges from objective wealth, why and how certain individual differences and contextual factors influence subjective wealth perceptions, and how differences across measures of consumer wealth may confer important differences that can influence downstream responses. Our framework identifies current gaps in the literature, offering new directions for future research, along with testable hypotheses related to the antecedents and consequences of subjective wealth.
... These actives are justified in the eyes of most people in both urban and rural settings as they are believed to be no harm to the children who would otherwise suffer even more due to the deep rooted poverty of households (PIN, 2009).Similarly studies also indicate that low income people engage more than the higher income people. Lottery incentives are particularly motivating in low income populations (Haisley, 2008) The Labour Proclamation of Ethiopia Proclamation No. 377/2003 stipulates that the minimum age for employment is 14 years. Children below the age of 14 are not allowed to work at all. ...
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s A lottery is a form of gambling from which revenue is obtained. Today many countries operate lotteries to increase their national income. Ethiopia had reestablished national lottery administration by proclamation no535/2007 intending to generate national revenue that could contribute to financing economic and social development programs and supervising lottery activities. In the lottery activities, children are taking part in taking from retailers by fixed commission and agreements. Many of the children from the Wolaita zone engaged in lottery ticket sales in big towns of the country. The main objective of this study was to assess the economic effects of lottery sales on Wolaita rural children. Specifically, the study was aimed to investigate the economic factors (push/pull) that make lottery sellers to engage in the lottery ticket sale, to explore the challenges and opportunities of lottery sellers in the new environment, to distinguish the contribution of lottery sales for the children's families economic life improvements and To find out the economic effects of lottery sales for lottery sellers/. This study used a descriptive cross-sectional research design. The sample size was determined by using yemane formula (1967) and 204 households were selected through multi-stage sampling techniques. The quantitative data were entered into SPSS version 20 and analyzed. The qualitative data were obtained through an interview with the social workers unit of the sampled woreda, lottery vendors in the area of destination, and FGD with composite groups of 36, each group consisting of 6. The results of the study show that the factors that push children from the area of origin are a land shortage, peer pressure, the role of child traffickers, absenteeism of parents, lack of soil fertility, the poor living condition of the parents. The pull factors of lottery vending are seeking a better life and job opportunities in the towns. The economic impact is low on the part of families and children and it created low employment opportunities as children are not beneficial. It is child labor exploitation for they are not beneficial after moving long-distance and selling lottery tickets.
... We asked respondents about their personal income rather than their household overall income, because studies have shown that questions about household income induce lower response rates and produce lower quality data [39]. Participants were asked to report their personal monthly income in a free-text box in order to avoid unintentional priming effects that come with the use of income brackets [40]. Moreover, in order to minimize reporting mistakes such as reporting yearly instead of monthly income, or unintentionally typing an additional zero, we calculated their annual income based on the monthly income they reported and asked them to confirm that it corresponded to their actual earnings. ...
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Social trust and income are associated both within and across countries, such that higher income typically correlates with increased trust. While this correlation is well-documented, the psychological mechanisms sustaining this relationship remain poorly understood. One plausible candidate is people’s temporal discounting: on the one hand, trust has a strong time component—it exposes the individual to immediate costs in exchange of uncertain and delayed benefits; on the other hand, temporal discounting is robustly influenced by income. The goal of our studies was to test whether temporal discounting mediates the relationship between income and trust and whether experimentally manipulating perceived income has a downstream impact on temporal discounting and trust. To do so, participants who underestimated their relative income position received information about their true position in the income distribution in order to correct their misperception. Our results indicate that temporal discounting partially mediates the effect of income on social trust in a pre-registered online study on British participants ( N = 855). However, receiving a positive information shock on one’s income position had no impact on either temporal discounting or social trust. In a second pre-registered study, we replicated the finding that temporal discounting partially mediates the effect of income on social trust in a representative sample of the British population ( N = 1130).
... We chose to ask respondents about their personal income rather than their household overall income because Micklewright and Schnepf (2010) have shown that questions about household income induce lower response rates and produce lower quality data. Participants were asked to report their personal monthly income in a free-text box, in order to avoid unintentional priming effects that can arise with the use of income brackets (Haisley et al., 2008). Participants were asked to report their level of education on a 6-point scale. ...
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Future-oriented individuals tend to display more pro-environmental attitudes and behaviours, compared to those who are present-oriented. Investigating the determinants of time preferences could therefore shed light on factors that also influence environmentalism. A key factor that impacts time preferences is socioeconomic status (SES). Importantly, SES is also positively correlated with willingness to act for the environment. In this paper, we test whether time preferences partially mediate the relationship between SES and pro-environmentalism in three studies. In the first study, we tested the assumption that pro-environmental attitudes are positively correlated with SES on a large cross-sectional French sample (N = 15,924). We found expected results both with an objective and a subjective measure of SES. Then, we conducted an online study including a temporal discounting task, which allowed us to fully test the mediation hypothesis on British participants (N = 650). Our results suggest that the positive association between SES and pro-environmental attitudes is partially mediated by temporal discounting, but no significant mediated relationship was found for pro-environmental behaviour. Finally, we conducted a third study with an experimental setting, for which we recruited British participants who underestimated their position in the income distribution (N = 855). In the treatment group, participants received a correction of their misperception, in order to increase their perceived relative income. Although the expected shift towards increased preferences for the future was not observed, we found a moderated effect of the treatment on pro-environmentalism.
... Contrary, to our expectations we did not find that an upward comparison increased delay discounting. Previous research on economic uncertainty, relative deprivation and stereotype threat have shown that experiences of this kind increase delay discounting (Mittal & Griskevicius, 2014), lead people to make risky economic decisions (Haisley, Mostafa, & Loewenstein, 2008), and increase caloric intake (Cheon & Hong, 2017). A possible explanation is that a downward comparison related to income level may not have been threatening to low-income individuals, assuming that they are already aware that they have low incomes. ...
Thesis
How can we reduce the social gradient in obesity if we do not know what causes it in the first place? This PhD thesis explores underlying explanations of the association between socioeconomic status and eating behaviors. Taking a social psychological approach, this thesis presents the results from a series of empirical studies that test how relative socioeconomic status affects decision-making. In particular, it examines how perceptions of one’s relative status affects impulsivity, and how someone else’s relative status influences beliefs about that person’s impulsivity. Together, these findings reveal both the existence and accuracy of impulsivity stereotypes. The findings suggest that (adherence to) these stereotypical behaviors are malleable and can be used in health interventions aimed at reducing health gradients.
Chapter
cognitive, technological, and regulative prerequisites for the existence of monopolies.
Article
Perceived financial constraints are ubiquitous, and prior research suggests that consumers who feel financially constrained are especially likely to engage in compensatory consumption to signal positive attributes or offset the aversiveness associated with their state. However, it is unclear whether spending confers greater happiness when consumers feel financially constrained. Seven high-powered studies (N = 7,228) demonstrate that perceived financial constraints decrease the happiness consumers derive from their purchases. This effect is robust across several purchase types and occurs in part because consumers who perceive greater financial constraints are more likely to consider opportunity costs when evaluating their purchases (studies 2A-2B). Consistent with this mechanism, the effect attenuates when all consumers are prompted to consider opportunity costs (study 3) and when consumers consider planned purchases (study 4). The negative effect of perceived financial constraints on purchase happiness results in an important behavioral outcome: less favorable consumer reviews (studies 5A-5B). The authors conclude by meta-analyzing their file drawer (25,765 participants; 42 studies) to explore how the effect differs across several purchase types and discussing theoretical and practical implications for consumers and marketers.
Article
Individual‐based relative deprivation (IRD) refers to anger and resentment associated with upward interpersonal comparison. Four studies investigated whether and when IRD can be a result of receiving help. In all the studies, we found an interaction between type of help (i.e., autonomy‐oriented vs. dependency‐oriented help) and status discrepancy such that participants experienced a higher level of IRD after receiving dependency‐oriented help from a higher status helper than in other conditions. This interaction emerged uniquely on IRD, but not on general affect, self‐esteem, or evaluations of helper. Moreover, Study 3 indicated that the perception of a diminished likelihood of changing mediated the impact of dependency‐oriented, high‐status help on IRD. Study 4 showed that IRD stemming from such help was positively associated with prioritizing self‐interest over others’. Implications for research on help and IRD are discussed.
Article
Combining a standard measure of concern about low relative wealth and a standard measure of relative risk aversion leads to a novel explanation of variation in risk-taking behavior identified and documented by social psychologists and economists. We obtain two results: (1) Holding individual i’s wealth and his rank in the wealth distribution constant, the individual’s relative risk aversion decreases when he becomes more relatively deprived as a result of an increase in the average wealth of the individuals who are wealthier than he is. (2) If relative deprivation enters the individual’s utility function approximately linearly then, holding constant individual i’s wealth and the average wealth of the individuals who are wealthier than he is, the individual’s relative risk aversion decreases when he becomes more relatively deprived as a result of a decline in his rank. Our findings provide a theoretical support for evidence about the propensity of relatively deprived individuals to gamble and resort to other risky behaviors.
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Research with Indigenous Psychological approach was aimed to develop the concept of subjective poverty in Indonesia, especially in Central Java. The population was college students in Surakarta, Central Java and sample were selected by multistage cluster random sampling technique. Totally sample was 241 respondents consisted of 50 men and 191 women. Data collecting was done by an open-ended questionnaire and content analysis was used to analyze the data. The result of the study showed that subjective poverty was multi-aspect which can be categorized in four aspect domains i.e. economic aspect (59.90%), physical and competence (7.25%), spiritual (7.25%), and psychosocial aspect (6.28%). The emergence of these aspects couldn't be separated from the internal and external factor that comes from outside as well as inside the individual factors i.e. the difficulties to distinguish the needs and desires (7.73%), negative thought and affect that arise because of the social comparison with situation and experience of others (5.31%), the lack of gratitude (4.83%), and lack of skills in money management (1.45%). It could be concluded that subjective poverty in Indonesian student perspective could become a reality poverty or mental poverty. Keywords: subjective poverty, poverty reality, poverty mentality
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MOOCs have created a breakthrough for learning and skill development among learners across all age groups. The purpose of this study is to explore the motives for the adoption and usage of Massive Open Online Courses in India among the Millennial generation. For the purpose of data collection, purposive sampling was used. Only those who have enrolled/registered and completed the MOOC courses were considered for the study. In-depth structured interviews were conducted with 30 Millennials born between 1981 to 1996. Content Analysis was used to analyse the qualitative data collected through the interviews. Findings reveal Nine Cs that have enhanced the MOOC adoption and usage like Career progression, Content, Challenge, Cognitive domain, Curiosity, Convenience, Certifications, Collaborative learning experience Capability, and Competency development. The results of this study will help in creating awareness about the factors triggering the MOOC adoption and how it can be improvised to enhance the learning experience.
Chapter
what consequentialist and deontological theories of justice are and how they relate to virtue ethics.
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Despite the growing interest among the scientific community regarding the power of subconscious, the current research did not find any evidence of its superiority over consciousness in generating positive consumer experience. This study shows that researches in subliminal messages have been set to work towards a set of pre-defined results and can only be used to generate some insignificant changes in social behaviour. Such behaviour is elicited only in laboratory conditions with specific situational variables. Interpretation of the existing corpus of the literature shows that subliminal messages can create negative experience which leads to hostile behaviour like derogatory comments on an African by an American citizen when the latter was primed with negative subliminal messages. Positive priming on the other hand showed weak presence in behaviour. However, research in the field of subliminal messages is required to inspect whether it is capable of improving mental health as indicated by few researches. Further exploration is required to prevent subliminal abuse. As indicated in the current study, subliminal messages when used in commercials are not capable of making a significant increase in sales figures when compared to supraliminal messages. Such messages and their wide-spread broadcast are not ethical because of the advertiser’s inclinations to use lascivious, disparaging or satanic stimuli which can lead to fatal outcomes like alleged suicide of a 10-year old boy. Positive experience or happiness is a subjective feeling and is generated by supraliminal messages which has been shown in the study to rely heavily on consciousness.
Article
Future-oriented individuals tend to display more pro-environmental attitudes and behaviours, compared to those who are present-oriented. Investigating the determinants of time preferences could therefore shed light on factors that also influence environmentalism. A key factor that impacts time preferences is socioeconomic status (SES). Importantly, SES is also positively correlated with willingness to act for the environment. In this paper, we test whether time preferences partially mediate the relationship between SES and pro-environmentalism in three studies. In the first study, we tested the assumption that pro-environmental attitudes are positively correlated with SES on a large cross-sectional French sample (N = 15,924). We found expected results both with an objective and a subjective measure of SES. Then, we conducted an online study including a temporal discounting task, which allowed us to fully test the mediation hypothesis on British participants (N = 650). Our results suggest that the positive association between SES and pro-environmental attitudes is partially mediated by temporal discounting, but no significant mediated relationship was found for pro-environmental behaviour. Finally, we conducted a third study with an experimental setting, for which we recruited British participants who underestimated their position in the income distribution (N = 855). In the treatment group, participants received a correction of their misperception, in order to increase their perceived relative income. Although the expected shift towards increased preferences for the future was not observed, we found a moderated effect of the treatment on pro-environmentalism.
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In diesem Kapitel lernen Sie …
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Gambling has had mixed reactions over the years as a positive economic activity and as a negative action that leads to addiction. The purpose of the study is to examine whether the level of income and nature of employment explain the actual instant gratification behavior among bettors in Uganda. This study adopted a cross-sectional quantitative research design. Data was collected from 257 bettors in 26 betting firms, and a census survey was found appropriate to achieve a response rate of 98%. The research findings indicate that low-income earners are more likely to engage in sports betting. Secondly, individuals with jobs where they have too much free time and inadequate supervision are most likely to participate in sports betting. We, therefore, recommend that both private and public organizations should be concerned about the impact of sports betting on their performance and employees. Most entities don't have gambling policies, and sports betting has a negative impact, for example, in terms of labor productivity and well-being of the employees; hence organizations need to develop clear anti-gambling policies at the workplace. Our study finds that the youth are the most gambling group in the country; specific gambling pieces of training and support services should be developed and organized for the child to increase the awareness of the impact of sports betting on their lives. Finally, there is a need to improve on the saving culture of Ugandans in addition to the revision of the minimum wage level for the workers in the country, and also introducing a weekly payment system would help to manage the betting behavior. In this study, Betting firms from one of the divisions Kampala Central Business District were studied, i.e., Nakawa. Yet, it would be better to cover all the divisions of Kampala; hence future studies should focus on all the divisions and may even study all the betting firms in the entire country. A self-administered questionnaire with close-ended questions was used to collect data from the field. However, this might have limited the amount of information collected from the respondents. Therefore, future studies should employ other methods, such as an interview guide.
Chapter
When it comes to happiness and satisfaction, consumer socioeconomic status (SES) has an important moderating role. In this chapter, we outline in which way SES intervenes in shaping consumer preferences and consumer happiness. When considering consumer preferences, low socioeconomic status has been shown to impact dietary patterns, such as consumption of fruits and vegetables, high caloric food, sugar-sweetened beverages, as well as consumption of alcohol and tobacco. Studies also show that low SES consumers tend to engage in purchases of various status-signaling goods. Socioeconomic status has also been shown to intervene in delineating happiness for experiential and material goods, consumer loyalty behavior, and consumer happiness with food consumption. We discuss the factors responsible for these relationships.
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In diesem Kapitel lernen Sie …
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This book is written for leading researchers and academic scientists, comprising of students and Faculty members of Academic Institutes, as well as corporate practitioners who have participated, contributed and value added immensely to the Conference. The book showcases recent research related to the areas of Business Research and Innovation. The book captures the efforts of the researchers to exchange and share their experiences and research results, and is a modest initiative by the Editors to appreciate research talents and to motivate research spirit among students, research scholars and academicians. The scope of the book covers the domains of Finance, Marketing, Operations & Information Systems Management, Business Innovation, Entrepreneurship, Organizational Behavior and Human Resource Management. Along with research and innovation, the book attempts to cover deliberations on recent challenges, and trends.
Article
This paper studies the adoption and impact of prize-linked savings (PLS) accounts, which offer lottery-like payouts to individual account holders in lieu of interest. Using microlevel data from a bank in South Africa, we show that PLS is attractive to a broad group of individuals, with financially constrained individuals and those with no other deposit accounts particularly likely to participate. Individuals who choose to use PLS increase their total savings on average by 1% of annual income. Exploiting the random assignment of prizes, we present causal evidence that PLS substitutes for lottery gambling but is a complement to standard savings. This paper was accepted by Tyler Shumway, finance.
Article
We conducted a high powered pre-registered study to investigate the relationship between childhood socioeconomic status, the adoption of different life history strategies and conformity. Contrary to our expectation we found no direct relationship between childhood socioeconomic background and conformity. However, we discovered a significant association between life history strategies and conformity. People who adopt fast (slow) life history strategies conform less (more) to social suggestions. Furthermore, we found a relationship between childhood socioeconomic background and life history strategies, with people from low (high) childhood socioeconomic backgrounds adopting fast (slow) life history strategies.
Article
Background and aims: Lottery gambling participation tends to be higher among lower socio-economic status (SES) individuals, but it is unclear how this relationship differs as a function of lottery type. We estimated how the relationship between SES and lottery gambling rates varies across different types of lottery gambling: fixed-prize, progressive-prize (jackpot) and instant-win (scratch card) lottery tickets in a large Canadian city. Design: Neighborhood-level lottery purchase data obtained from the Ontario Lottery and Gaming Commission were analysed in conjunction with demographic data. Mixed-effects regression was used to assess simultaneously how neighborhood-level SES predicts per-person lottery gambling rates across fixed-prize, progressive-prize lottery and instant-win lotteries. Setting and participants: Neighborhoods in Toronto, Ontario, Canada in the years 2012-15. Measurements: Per-capita sales in dollars (CAD) of fixed-prize lottery, progressive-prize lottery and instant-win tickets in Toronto postal codes. SES was estimated as a composite of income, years of education and white-collar employment. Findings: Lower-SES neighborhoods engaged in higher rates of lottery gambling overall [β = -0.084, standard error (SE) = 0.24, P = 0.0007]. The predictive effect of SES varied significantly by lottery type (fixed-prize: β = -0.105, SE = 0.004, P < 0.0001, instant-win: β = -0.054, SE = 0.004, P < 0.0001; relative to progressive-prize). The predictive effect of SES was strongest for fixed-prize lotteries and weakest for progressive-prize lotteries, such that we did not observe a significant predictive effect of SES for progressive-prize lotteries (β = -0.031, SE = 0.024, P = 0.198). Conclusions: People in lower socio-economic status neighborhoods in Toronto, Canada appear to engage in more lottery gambling than those in higher socio-economic status neighborhoods, with the difference being largest for fixed prize lotteries followed by instant win lotteries, and no clear difference for progressive prize lotteries.
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Many financial institutions in developing countries offer savings products. Yet, little has been done to assess systematically and quantitatively the relative merits of different product designs. This paper first examines different designs that provide incentives to clients to commit to save. Mechanisms are divided into deposit-side mechanisms that help clients make regular deposits, and withdrawal-side mechanisms that help clients restrict the use of their funds except for well-planned uses or emergencies. Then, using results from a short web-based survey of microfinance instititutions, we describe different commitment savings products in use around the world.
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Three studies examined preferences for outcomes to self and a codisputant. Studies 1 and 2 estimated social utility functions from judgments of satisfaction with alternative outcomes. Comparing functional forms, we found that a utility function, including terms for own payoff and for positive and negative discrepancies between the parties' payoff (advantageous and disadvantageous inequality), provides a close fit to the data. The typical utility function is steeply increasing and convex for disadvantageous inequality and weakly declining and convex for advantageous inequality. We manipulated dispute type (personal, business) and disputant relationship (positive, neutral, or negative) and found that both strongly influence preferences for advantageous but not disadvantageous inequality. A third study contrasted implications of the social utility functions with predictions of individual utility theories. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
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There is evidence that risk-taking behavior is influenced by prior monetary gains and losses. When endowed with house money, people become more risk taking. This paper is the first to report a house money effect in a dynamic, financial setting. Using an experimental method, we compare market outcomes across sessions that differ in the level of cash endowment (low and high). Our experimental results provide support for a house money effect. Traders’ bids, price predictions, and market prices are influenced by the amount of money that is provided prior to trading. However, dynamic behavior is difficult to interpret due to conflicting influences.
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Comparison of objects, events, and situations is integral to judgment; comparisons of the self with other people comprise one of the building blocks of human conduct and experience. After four decades of research, the topic of social comparison is more popular than ever. In this timely handbook a distinguished roster of researchers and theoreticians describe where the field has been since its development in the early 1950s and where it is likely to go next.
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This paper investigates whether individuals feel worse off when others around them earn more. In other words, do people care about relative position, and does “lagging behind the Joneses” diminish well-being? To answer this question, I match individual-level data containing various indicators of well-being to information about local average earnings. I find that, controlling for an individual's own income, higher earnings of neighbors are associated with lower levels of self-reported happiness. The data's panel nature and rich set of measures of well-being and behavior indicate that this association is not driven by selection or by changes in the way people define happiness. There is suggestive evidence that the negative effect of increases in neighbors' earnings on own well-being is most likely caused by interpersonal preferences, that is, people having utility functions that depend on relative consumption in addition to absolute consumption.
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The process of exchange is almost continual in human interactions, and appears to have characteristics peculiar to itself, and to generate affect, motivation, and behavior that cannot be predicted unless exchange processes are understood. This chapter describes two major concepts relating to the perception of justice and injustice; the concept of relative deprivation and the complementary concept of relative gratification. All dissatisfaction and low morale are related to a person's suffering injustice in social exchanges. However, a significant portion of cases can be usefully explained by invoking injustice as an explanatory concept. In the theory of inequity, both the antecedents and consequences of perceived injustice have been stated in terms that permit quite specific predictions to be made about the behavior of persons entering social exchanges. Relative deprivation and distributive justice, as theoretical concepts, specify some of the conditions that arouse perceptions of injustice and complementarily, the conditions that lead men to feel that their relations with others are just. The need for much additional research notwithstanding, the theoretical analyses that have been made of injustice in social exchanges should result not only in a better general understanding of the phenomenon, but should lead to a degree of social control not previously possible. The experience of injustice need not be an accepted fact of life.
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We investigate the manner in which a desire to emulate the rich influences individuals’ allocation of time between labour and leisure, greater inequality inducing longer work hours as a result. Data on work hours in ten countries over the period 1963–98 show that greater inequality is indeed associated longer work hours. These ‘Veblen effects’ are large and the estimates are robust using country fixed effects and other specifications. Because consumption inequality is a public bad, a social welfare optimum cannot be implemented by a flat tax on consumption but may be accomplished by more complicated (progressive) consumption taxes.
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This report provides an overview of lottery operations, with particular attention to who plays the lottery, how the lotteries are marketed, and what kinds of policy alternatives exist for state and federal policymakers. Section I of the report provides a descriptive overview of state lotteries, a statistical profile, and a description of the distribution and size of their revenues. Section II discusses the findings from the national survey of gambling conducted by NORC for the Commission. Section III presents a preliminary analysis of data availa ble to marketers as well as an initial assessment of marketing plans. The final section of the report discusses the prominent policy issues involved in the legalization and operation of state lotteries.
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Examines a theory of relative deprivation which states that objective and subjective well-being are not isomorphically related, so that sometimes the better off one is, the worse off one feels subjectively. After a brief review of work in the area of relative deprivation, a formal model is developed. It is argued that an individual feels resentment about failure to possess something (X) only when he sees that similar others possess X, he wants X, he feels entitled to possess X, he thinks that possession of X is feasible, and he does not blame himself for his failure to possess X. The antecedents of these conditions are explored, and the consequences of the emotion of relative deprivation are studied. Empirical evidence relating to and supporting the model is briefly discussed. (4 p ref) (PsycINFO Database Record (c) 2012 APA, all rights reserved)
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This paper reports an experiment testing two hypotheses. The first is that the value or utility associated with a payment to one's self and a payment to a co-worker can be represented as an additive function of a utility for own payment (nonsocial utility) and a utility for the difference between own and other's payment (social utility). The second hypothesis is that changes in the amount of work accomplished by one's self and/or the other should influence the social, but not the the nonsocial utilities. Support for both hypotheses is reported.
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The nature of revenue generation for state-sponsored lotteries has been an issue of public debate for quite some time. Although most studies have found lotteries to have a regressive tax incidence, several have concluded otherwise. Unfortunately, the vast majority of academic studies address this concern by examining the tax incidence of only one state's lottery and/or by using only one time period's data. In addition, many assessments of the tax impact of lotteries fail to consider other demographic variables that may influence purchase patterns and, thus, be of interest to policymakers. To remedy this, the current paper assesses the incidence of the lottery excise tax for five states using county level data spanning multiple years. Also assessed are changes in incidence across demographic groups as the lotteries matured. Lottery tax incidence is assessed with multiple regression estimates of the income elasticity of demand for lottery products. The predominant finding is that the lottery tax for these states had a regressive incidence. Otherwise, few consistencies in either change in lottery tax incidence or purchase patterns across demographic variables were found.
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'Conspicuous consumption of valuable goods is a means of reputability to the gentleman of leisure.' In The Theory of the Leisure Class Thorstein Veblen sets out 'to discuss the place and value of the leisure class as an economic factor in modern life'. In so doing he produced a landmark study of affluent American society that exposes, with brilliant ruthlessness, the habits of production and waste that link invidious business tactics and barbaric social behaviour. Veblen's analysis of the evolutionary process sees greed as the overriding motive in the modern economy; with an impartial gaze he examines the human cost paid when social institutions exploit the consumption of unessential goods for the sake of personal profit. Fashion, beauty, animals, sports, the home, the clergy, scholars - all are assessed for their true usefulness and found wanting. The targets of Veblen's coruscating satire are as evident today as they were a century ago, and his book still has the power to shock and enlighten. Veblen's uncompromising arguments and the influential literary force of his writing are assessed in Martha Banta's Introduction.
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Is it better to be a big frog in a small pond or a small frog in a big pond? In this lively and original book, the author argues persuasively that people's concerns about status permeate and profoundly alter a broad range of human behaviour. He takes issue with his fellow economists for too often neglecting fundamental elements in human nature in their study of how people make basic economic choices.
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Mental accounting is an oft-discussed type of decision framing in which individuals are hypothesized to form psychological accounts of the advantages and disadvantages of an event or option. Most discussions of mental accounting have focused on the consequences of framing decisions in this manner rather than on the processes underlying mental accounting. Close examination of these processes suggests they are the same as the processes described in categorization, schema, and script theories. The present manuscript provides insights into the processes hypothesized to underlie mental accounting. This is accomplished by documenting the conceptual equivalence of selected categorization and mental accounting principles and by using empirical data to illustrate the similarity of the principles. In doing so, a mental account is treated as a type of category.
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The abstract for this document is available on CSA Illumina.To view the Abstract, click the Abstract button above the document title.
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This paper investigates whether individuals feel worse off when others around them earn more. In other words, do people care about relative position, and does "lagging behind the Joneses" diminish well-being? To answer this question, I match individual-level data containing various indicators of well-being to information about local average earnings. I find that, controlling for an individual's own income, higher earnings of neighbors are associated with lower levels of self-reported happiness. The data's panel nature and rich set of measures of well-being and behavior indicate that this association is not driven by selection or by changes in the way people define happiness. There is suggestive evidence that the negative effect of increases in neighbors' earnings on own well-being is most likely caused by interpersonal preferences, that is, people having utility functions that depend on relative consumption in addition to absolute consumption. © 2005 MIT Press
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Two studies provide evidence for social comparison effects of income on subjective well-being (SWB). The 1st study of 7,023 persons from nationally representative samples in the United States shows that the range and skew of the income distribution in a community affects a person's happiness, as predicted by range-frequency theory. The 2nd study of 8 nations over a period of 25 years shows that decreasing the skew (inequality) of the income distribution in a country increases average national SWB. Both studies strongly support social comparison effects of income within a community, and both results are predicted by range-frequency theory. These studies are the first to successfully extend earlier results of R. H. Smith, E. Diener, and D. H. Wedell (1989) from the laboratory into naturalistic situations. The magnitude of the social comparison effects is smaller than the main effect of income, which implies that nations can avoid creating a "hedonic treadmill."
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One of the famous questions in social science is whether money makes people happy. We offer new evidence by using longitudinal data on a random sample of Britons who receive medium-sized lottery wins of between 1000 pounds and 120,000 pounds (that is, up to approximately US$ 200,000). When compared to two control groups -- one with no wins and the other with small wins -- these individuals go on eventually to exhibit significantly better psychological health. Two years after a lottery win, the average measured improvement in mental wellbeing is 1.4 GHQ points.
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Experimental economists are leaving the reservation. They are recruiting subjects in the field rather than in the classroom, using field goods rather than induced valuations, and using field context rather than abstract terminology in instructions. We argue that there is something methodologically fundamental behind this trend. Field experiments differ from laboratory experiments in many ways. Although it is tempting to view field experiments as simply less controlled variants of laboratory experiments, we argue that to do so would be to seriously mischaracterize them. What passes for "control" in laboratory experiments might in fact be precisely the opposite if it is artificial to the subject or context of the task. We propose six factors that can be used to determine the field context of an experiment: the nature of the subject pool, the nature of the information that the subjects bring to the task, the nature of the commodity, the nature of the task or trading rules applied, the nature of the stakes, and the environment that subjects operate in.
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Today, as in the past, within a country at a given time those with higher incomes are, on average, happier. However, raising the incomes of all does not increase the happiness of all. This is because the material norms on which judgments of well-being are based increase in the same proportion as the actual income of the society. These conclusions are suggested by data on reported happiness, material norms, and income collected in surveys in a number of countries over the past half century.
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Corruption in the public sector erodes tax compliance and leads to higher tax evasion. Moreover, corrupt public officials abuse their public power to extort bribes from the private agents. In both types of interaction with the public sector, the private agents are bound to face uncertainty with respect to their disposable incomes. To analyse effects of this uncertainty, a stochastic dynamic growth model with the public sector is examined. It is shown that deterministic excessive red tape and corruption deteriorate the growth potential through income redistribution and public sector inefficiencies. Most importantly, it is demonstrated that the increase in corruption via higher uncertainty exerts adverse effects on capital accumulation, thus leading to lower growth rates.
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Analysis of decision making under risk has been dominated by expected utility theory, which generally accounts for people's actions. Presents a critique of expected utility theory as a descriptive model of decision making under risk, and argues that common forms of utility theory are not adequate, and proposes an alternative theory of choice under risk called prospect theory. In expected utility theory, utilities of outcomes are weighted by their probabilities. Considers results of responses to various hypothetical decision situations under risk and shows results that violate the tenets of expected utility theory. People overweight outcomes considered certain, relative to outcomes that are merely probable, a situation called the "certainty effect." This effect contributes to risk aversion in choices involving sure gains, and to risk seeking in choices involving sure losses. In choices where gains are replaced by losses, the pattern is called the "reflection effect." People discard components shared by all prospects under consideration, a tendency called the "isolation effect." Also shows that in choice situations, preferences may be altered by different representations of probabilities. Develops an alternative theory of individual decision making under risk, called prospect theory, developed for simple prospects with monetary outcomes and stated probabilities, in which value is given to gains and losses (i.e., changes in wealth or welfare) rather than to final assets, and probabilities are replaced by decision weights. The theory has two phases. The editing phase organizes and reformulates the options to simplify later evaluation and choice. The edited prospects are evaluated and the highest value prospect chosen. Discusses and models this theory, and offers directions for extending prospect theory are offered. (TNM)
Ltd DOI: 10.1002 For schools, lottery payoffs fall short of promises
  • Copyright
  • R Stodghill
  • R Nixon
Copyright # 2008 John Wiley & Sons, Ltd. Journal of Behavioral Decision Making, 21, 283–295, (2008) DOI: 10.1002/bdm Stodghill, R., & Nixon, R. (2007). For schools, lottery payoffs fall short of promises. New York Times. Retrieved October 7, 2007, from http://www.nytimes.com/2007/10/07/ business/07lotto.html?_r¼1&partner¼rssnyt&emc¼ rss&oref¼-slogin.
What if the Lottery were run for lottery players? Raleigh News & Observer State lotteries at the turn of the century: Report to the national gambling impact study commission A model of egoistic relative deprivation
  • C T Clotfelter
  • P J Cook
  • C T Clotfelter
  • P J Cook
  • J A Edell
  • M Moore
Clotfelter, C. T., & Cook, P. J. (2007). What if the Lottery were run for lottery players? Raleigh News & Observer. Retrieved March 15, 2007 from http://www.newsobserver. com/702/story/548219.html. Clotfelter, C. T., Cook, P. J., Edell, J. A., & Moore, M. (1999). State lotteries at the turn of the century: Report to the national gambling impact study commission. Retrieved November 3, 2007 from http://govinfo.library.unt.edu/ ngisc/ reports/lotfinal.pdf. Crosby, F. (1976). A model of egoistic relative deprivation. Psychological Review, 83, 95–113.
DOI: 10.1002/bdm E. Haisley et al. Subjective Relative Income and Lottery Ticket Purchases Clotfelter Implicit taxation in lottery finance
  • Copyright
Copyright # 2008 John Wiley & Sons, Ltd. Journal of Behavioral Decision Making, 21, 283–295, (2008) DOI: 10.1002/bdm E. Haisley et al. Subjective Relative Income and Lottery Ticket Purchases Clotfelter, C. T., & Cook, P. J. (1987). Implicit taxation in lottery finance. National Tax Journal, 40, 533–546.
LaFleur's 2003 world lottery almanac
  • T Lafleur
  • B Lafleur
LaFleur, T., & LaFleur, B. (2003). LaFleur's 2003 world lottery almanac. Boyds: TLF Publications.
A review of commitment savings products in developing countries. Asian Development Bank Economics and Research Department Working Paper Series
  • N Ashraf
  • N Gons
  • D S Karlan
  • W Yin
Ashraf, N., Gons, N., Karlan, D. S., & Yin, W. (2003). A review of commitment savings products in developing countries. Asian Development Bank Economics and Research Department Working Paper Series, 45, 1–37.