What are you buying for that lottery ticket?

­Most economists, conservative and liberal, are in complete agreement that lotteries are a bad gamble.  You pay $2 for the ticket and your expected return is $1 on average.  Yes there is the powerball $200 million prize.  But then there are millions of people who get nothing.  Or who get a free ticket that gets them nothing.  And yet somehow, lotteries are the biggest form of gambling in the country.  What gives?

It turns out, that you are getting more than the expected financial return for your $2.  You have three days to dream.  You can look at the ticket and imagine what you would do if you won the $200 million.  After all, it IS possible.  And since most people can’t really perceive the difference between 1 in 300 million odds or 1 in a million, it doesn’t seem like such a bad gamble.  Look at how jubilant those winners are when they are showcased on the news.  They are not fake reality show millionaires.  They are scrubs just like you who really really won.  And they can live the high life for the rest of their life. 

That dream is what is worth the $2.  You pay $9 to go to a movie (plus popcorn) and that only puts you in dreamland for a few hours.  The lottery is a much better deal than that.  Lotteries are a form of entertainment, not a form of income.  Seen from that perspective, it doesn’t sound so bad.

But there is an even better solution (thanks to Freakonomics for the tip).  One of the big problems with lotteries is that most of the customers are low-income people who spend more than they can really afford.  OK, they get a great dream.  But then they can’t make the rent.  This sucks.

So imagine something called a no-lose lottery.  When you put your money in a savings account at a bank, it earns interest.  Right now that is very low but it is usually a couple of percent.  Let’s say we take a smidge of the interest from everyone’s bank account.  That would be millions.  Just as much as in a powerball ticket.  And we could turn that money into prizes.  So instead of using your rent money to buy the dream, you get the dream for a smidge of your savings that you don’t even notice is missing.  It would also encourage people to save.

The administrative costs would be minimal.  The bank could send you your lottery numbers every month in your statement.  No extra mailing (email or snail) and a computer could automatically generate the numbers.  They could still do the drawings on the local news and publish them in the local papers.  And you could have posters up in the bank to promote the program. Just as much hype if you want.

We can debate over whether it should be part of every savings account (like a tax) or an opt-in for certain accounts.  We can debate over whether to have one big $200 million prize or have 200 $1 million prizes.  We can debate how to define a smidge and how much can be spent on administrative fees.  But I would guess that whatever we decide, liberal, conservative or otherwise, it is better than the lottery.

Motivated Reasoning and Federalism

As you know, motivated reasoning is my primary interest.  It is what I do my research in, teach in, consult in, blog about, and dream about.  I find ways to apply it to just about everything.   But I realized that there is a huge area where just about everyone uses motivated reasoning and it impacts our lives more than we know.  It is in policy.  Federalism v localism.  That sounds boring, but really it is not.

We have many beliefs.  We want to tax the rich or leave them free to create jobs.  We want same sex marriage to be legal or leave it to the churches.  We want to legalize marijuana, decriminalize it, or keep it the way it is. And on and on.  In some of these cases, we have strong logical arguments for or against.  But in many of these cases, what we think is a strong logical argument is being skewed by motivated reasoning with regard to the federalist/localist dimension.

Here is what I mean.  Let’s say that an otherwise liberally minded person doesn’t believe in same sex marriage.  Don’t worry about why for now – this kind of belief exists.  But they can’t admit it, even to themselves, that they are against it because it causes cognitive dissonance to themselves and social embarrassment in public.  It goes against their more general belief to support minority rights.  So instead of being against it, they can say they just don’t think the government should be involved.  This way, they can vote against it without admitting why.  It sounds better (to themselves and their friends) that they don’t think the government should force an otherwise religious belief on the population.  I see this happening a lot in the current debate about mandating insurance coverage of birth control.  I see people who want to be against it, don’t know why, so they become against the “mandate” on religious institutions.  And they can still feel liberal.

Same thing with going the other way.  Let’s say an otherwise conservatively minded person does believe in same sex marriage.  But they can’t admit it to themselves because it causes cognitive dissonance to themselves and social embarrassment in public.  So instead of being for it, they can say they just don’t think government should be involved.  So they can vote for it without admitting why.  It sounds better (to themselves and their friends) that they don’t think government should be involved in defining such a private issue like marriage.  Again, I see it in the birth control debate.  They want to be for it, but don’t know why, so they become for liberty of the employee who follows a different religion.  And they can still feel conservative.

I bring this up today because I would suggest that you make a list of all your policy positions and see where you have been saying they should be regulated.  If you see inconsistencies, it just might be motivated reasoning showing its all too common face.  I found some in mine.  I need to think deeply to see if I really think they should be regulated at different levels or if I am just thinking that to make myself feel better about having inconsistent beliefs.

Free Will (yeah, again !!!)

In an interview with Marcel Brass (a very knowledgeable cognitive neuroscientist), Dr. Brass was describing studies that he has done and others have done regarding understanding free will through brain scans,  The interviewer first asked about the famous Libet study (well, famous to us free-will-o-philes) that seemed to show that free will is a false impression that evolved to help us explain our own behavior.  But there were some methodological flaws in the original study, so Brass describes a lot of follow up studies that have looked in more detail in different ways to try to overcome the flaws.  

In each case, the results show that our feeling of free will is really just a reconstruction of what we have already done in a way that explains it rationally.  In other words, if unconscious processes cause us to do something, our conscious brain then explains it by concluding that we did it “because we wanted to” and therefore we believe we have free will.  But these neuroscience studies show that this decision that we “wanted to” occurs AFTER we already did it. So it is a memory phenomenon, not a decision phenomenon.  We do it, then we decide we wanted to (past tense)  – rather than we decide we want to do it (present tense) and then do it.   

Some of the studies showed that the experimenter could change whether we perceived that we “wanted” do something AFTER we finished actually doing it.  So our perception of the intention (the free will) is bogus.  This doesn’t mean we don’t have free will; it just proves that the fact that we feel like we have free will is not evidence for it.  We need to look elsewhere.

Another great study is that the more you believe you have free will, the more control you exert on your behavior.  So if we don’t believe in free will, we don’t worry so much about what we do and are more likely to just accept whatever is happening around us.  Believing in free will makes us better people.  So don’t believe anything I just wrote about!!!

These studies use some very cool methods that are too hard to explain in such a short space.  So you either need to take my word for it, read the original papers (if you have access to a university library) or listen to the interview and take Dr. Brass’ word for it.

Acoustic Human Factors

You know how when you open a new jar or bottle you get that suction sound that proves to you that it has never been opened before?  Some of them even have a warning message that if you don’t hear that sound the product may have been tampered with.  I think most of you know that this is a highly engineered design that marketing and engineering got together and created.  They play with the amount of air in the jar, the tightness of the seal, and then test all these combinations to see which one sounds the “safest” – gives customers the most confidence that it was really sealed.

The same thing goes on with the sound of a car door closing.  The marketing and engineering teams get together and figure out the design that makes the customer the most confident that it is a tight seal (even if it has no basis in reality). 

So I just found a new one (or maybe it is actually real, who knows).  I have a new sports water bottle.  Every time I open it, I get that suction sound that you usually only get when you open a new bottle. I am not sure if the bottle is really re-sealing or if it is a designed artifact.  But even though I am suspicious, I love this bottle.  It makes me feel good just to pretend that I am getting a better protected drink inside.  Especially when it is something other than water or when I leave it filled for a week. 

I know this is probably motivated reasoning on my part, and now with all my research on motivated reasoning it is pretty sad that I would knowingly fall for it.  But I can feel it working inside my head anyway.  I love this bottle. Why give up that pleasure for a little truth and logic ???

understanding is not the same as compassion

Wow, I didn’t even know this kind of research was possible, but it blew my mind.  I read through the methods pretty carefully to make sure that it was legit.  It was published in a very reputable journal by brain researchers from MIT, so they have the credibility.  Here is a summary of what they found.

They had Israelis, Arabs, and South Americans read different stories about individuals from all three groups.  All of the stories involved either the person experiencing physical pain (stepping on a thumbtack) or emotional pain (not getting an expected raise at work).  They did fMRI on three areas of the brain.  The area that we use to predict the physical experience of another person, the area that we use to predict the emotional thoughts of another person, and the area where we feel compassion.  They also asked the people to verbally rate how much physical or emotional pain they thought the person in the story was feeling, and compassion they felt for the person in the story.

So here is what shocked me.  What matters when modeling both the physical and emotional pain of the other person is based on experience and knowledge.  So Israelis could accurately predict how much pain the Israelis in the story felt.  They could also accurately predict the pain felt by the Arabs, who they know pretty well.  But they were less accurate at predicting the pain of the South Americans, who they don’t have as much experience/knowledge of (on average).  The same thing was true of the Arabs.  They could accurately predict their own pain and the Israelis’ pain, but were less accurate for the South Americans.  This was true of the fMRI areas and the verbal reports. So it wasn’t any kind of unconscious self-deception.

But the bias appeared with the feelings of compassion.  The conflict groups (Arabs to Israelis and Israelis to Arabs) were lower in the fMRI and the verbal reports than either the self-group or the distant unknown out-group.  So Arabs felt the Israeli's pain, they just didn't care.  And vice versa.  But both groups did care for their own group and for the South Americans.  Somewhere in between actual prediction of the pain and compassion for the pain, the conflict group goes down and the distant unknown group goes up.  Again, it was true of both the fMRI and the verbal reports.  So it is not self-deception, it is something really electronic in the way the brain is wired.  Whether it is conscious or unconscious, our brains electrically add compassion to distant groups when we think it is deserved, but it decreases compassion to the conflict group because we think it is not deserved. 

Not a good finding when it comes to hoping for eventual peace.  Facts don’t seem to matter. A better understanding of the other person’s situation won’t help, because that group doesn’t “deserve” compassion, even if their pain is real.

The next paper in this journal is by University of Michigan researchers on political candidates. Can’t wait to read that one.

Motivated Reasoning

I have often blogged about the phenomenon of motivated reasoning.  This afternoon, I had a stark, in my face experience with it myself.  I spilled some coffee on the carpet in my rental apartment this morning.  It would definitely leave a stain if I didn’t clean it up right away.  But I plan to live here at least another year or two.  There will definitely be some more stains by the time I leave that I don’t notice in time to clean.  So when I get my move out inspection, will this one extra stain really make a difference?  It would be really easy just to ignore it.  It is pretty small.

I can remember the motivated reasoning occurring in my head as I type.  I imagined the day of the check out inspection, the person looking at the entire carpet and deciding whether it needs either cleaning (normal wear) or replacing (deduct from my security deposit).  I imagined him looking at all the stains and deciding.  The small coffee stain has little to do with his final decision.  

If this sounds reasonable, I make the classic fundamental attribution error and ignore the stain today.  We value things (in this case the time to clean) today more than we value things (in this case the security deposit refund) in the future.  This is the classic overdiscounting error and is the basis for our overly strong desire for instant gratification. 

Only if this best case scenario (because it allows me to skip the cleaning) seems clearly unreasonable would I be motivated to clean the stain at that moment.  Nope.