Predicting Lotto Numbers
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Predicting Lotto Numbers. / Jørgensen, Claus Bjørn; Suetens, Sigrid ; Tyran, Jean-Robert.
Department of Economics, University of Copenhagen, 2011.Research output: Working paper › Research
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TY - UNPB
T1 - Predicting Lotto Numbers
AU - Jørgensen, Claus Bjørn
AU - Suetens, Sigrid
AU - Tyran, Jean-Robert
N1 - JEL classification: D03, D81, D84
PY - 2011
Y1 - 2011
N2 - We investigate the “law of small numbers” using a unique panel data set on lotto gambling. Because we can track individual players over time, we can measure how they react to outcomes of recent lotto drawings. We can therefore test whether they behave as if they believe they can predict lotto numbers based on recent drawings. While most players pick the same set of numbers week after week without regards of numbers drawn or anything else, we find that those who do change, act on average in the way predicted by the law of small numbers as formalized in recent behavioral theory. In particular, on average they move away from numbers that have recently been drawn, as suggested by the “gambler’s fallacy”, and move toward numbers that are on streak, i.e. have been drawn several weeks in a row, consistent with the “hot hand fallacy”.
AB - We investigate the “law of small numbers” using a unique panel data set on lotto gambling. Because we can track individual players over time, we can measure how they react to outcomes of recent lotto drawings. We can therefore test whether they behave as if they believe they can predict lotto numbers based on recent drawings. While most players pick the same set of numbers week after week without regards of numbers drawn or anything else, we find that those who do change, act on average in the way predicted by the law of small numbers as formalized in recent behavioral theory. In particular, on average they move away from numbers that have recently been drawn, as suggested by the “gambler’s fallacy”, and move toward numbers that are on streak, i.e. have been drawn several weeks in a row, consistent with the “hot hand fallacy”.
KW - Faculty of Social Sciences
KW - gambler’s fallacy
KW - hot hand fallacy
KW - representativeness
KW - law of small numbers
M3 - Working paper
BT - Predicting Lotto Numbers
PB - Department of Economics, University of Copenhagen
ER -
ID: 33116399