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The Mathematics Enthusiast

Authors

Matt Lane

Volume

12

Issue

1-3

Abstract

In math class, expected value is often used when deciding whether or not a game is worth playing. A common refrain is that games with negative expected value should be avoided. However, nearly all games of chance have a negative expected value, and a simple expected value analysis fails to explain why these games are so popular. In this article, we consider three psychological factors leading to irrational gambling behavior – the illusion of control, hypersensitivity to reward, and beginner’s luck – and explore how these factors affect an otherwise purely rational model of gambling behavior.

First Page

31

Last Page

37

Included in

Mathematics Commons

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