You don’t need to be a CFA charterholder or a statistics wizard to see that the Pick 3 and Pick 4 lottery games are straight up criminal. *all the games technically have negative expected value but in particular the pick 3 and pick 4 games are the worse. I don’t understand how they get away with it considering casinos (Vegas/AC) actually have gaming commissions that enforce such fairness laws.
Simply the Pick 3 and Pick 4 game odds of 1 in 1,000/10,000 have jackpots of $500 and $5000 each… This would be like risking $1 on black at the roulette wheel to win $0.50.
2 questions
are people just stupid?
why hasn’t some consumer protections groups attempted to stop it?
Think about it… Who is more likely to play the lottery? My guess is someone who isn’t necessarily the brightest crayon in the box. Screw the odds – just the possibility to make a dolla outta 15cent is enticing enough.
And how does the government justify it? By using some of the funds for social welfare. (And if the odds didn’t favor the House, then why would the game be created within the system in the first place?)
you clearly have not read the behavioral L3 section. Its a bet with bad odds but the cost is rather low (1-2 an entry) and the winnings are pretty high. If you look at how much people spend over their life it can be a lot, but a few dollars here and there dont mean much to a person. I bought a juice today for 2 dollars, i could have got lotto tickets, i dont really NEED either.
When the jackpots high ill throw in $5 to an office pool on the long shot. Its fun to talk wiht the people in the office about the outlandish stuff we could do then laugh when you dont get 1 number right.
when mega millions/ powerball jackpot goes above $200-$300m ill play… in this case its still has a negative expected value but not (-50%) like the pick 3/ pick 4 scam… in fact when the powerball approached $1bn last year it actually had +ev assuming no one split the prize. comparison the casino edge betting on black on a single zero roulette wheel is about 2%
when the jackpot hits the higher levels there is actually a lower the expected payout due to the fact that so many more people play and you are more likely to get multiple winners
Casinos are for-profit businesses. They need people to win - or, rather, think they can win - so they’ll keep coming back. Lotteries are non-profit games to fund public education. There’s no comparing the two.
^ and also if you look at how casinos really make their money its on 2 things. High rollers, and slot machines. Read online from casino employees that the quickest way to earn comps is via slots because you have the worst odds. For comps they use a formula that basically predicts how profitable your gambling is to them and table games dont provide nearly as much revenue as slots do.
yea those seem to be an addiction, most i could ever pony up was $5 on a scratcher. Guy i worked with at the local grocery store when i was in high school (he was older probably 40yo lifer there) hit a $10 scratcher for like 250k. Bought a used car for like 6k and put the rest in a college fund for his kids. Was glad to see he didnt spent it all like an idiot
How about the fact that the state is able to call the jackpot, say, $20 million, but we all know with the discount back to PV it is about half that. If a private person advertised like that, he would be thrown in jail.
Many years ago the State of California continued to advertise the grand prize of x million on some scratcher game when they KNEW it had already been claimed. Somebody sued, the state claimed Sovereign Immunity and won. F’n government.
i remember reading that the lottery was outlawed in the US in the 1970s(?) but the mob was making so much money that they states had to legalize it and get it on the profits