Most people aren’t shocked when they don’t win the lottery. The odds are heavily stacked against them and there is little they could have done differently to change the outcome. They might feel differently however, if they had at one point owned the winning ticket but made the decision to trade it. They would most likely feel some, if not overwhelming, regret.
When the Powerball jackpot rose to $1.5 billion in January 2016, we asked people to sell us their lottery tickets for more than the cost of the ticket. This seemed like a pretty good offer. Since the odds of winning with the new ticket are exactly the same, they could buy a new ticket and pocket the extra cash to come out ahead. However, a cognitive bias known as regret avoidance can make it difficult for people to choose the extra cash. The anticipated regret of giving up what might be the winning ticket weighs heavily on their decision.
Regret avoidance in a lottery was tested on Israeli college students in a 1996 study. The students were given lottery tickets and told that one of them would be chosen to win $17. The students were offered expensive-looking chocolate if they agreed to trade tickets with a classmate. 59% of the students refused to trade even though they were just as likely to win with a new ticket and had the added incentive.
Produced by Jenner Deal and Sara Silverstein
Follow BI Video: On Twitter
Business Insider Emails & Alerts
Site highlights each day to your inbox.