Reducing ambiguity in lotteries: Evidence from a field experiment
| Authors | |
|---|---|
| Year of publication | 2015 |
| Type | Article in Periodical |
| Magazine / Source | Applied Economics Letters |
| MU Faculty or unit | |
| Citation | |
| Web | http://www.tandfonline.com/doi/full/10.1080/13504851.2015.1066480 |
| Doi | http://dx.doi.org/10.1080/13504851.2015.1066480 |
| Field | Economy |
| Keywords | ambiguity - lottery - field experiment |
| Attached files | |
| Description | Ambiguity about the chances of winning represents a key aspect in lotteries. By means of a controlled field experiment, we exogenously vary the degree of ambiguity about the winning chances of lotteries organized to incentivize the contribution for a public good. In one treatment, people have been simply informed about the maximum number of potential participants (i.e. the number of lottery tickets released). In a second treatment, this information has been omitted as in all traditional lotteries. Our general finding shows that simply reducing the degree of ambiguity of the lottery leads to a sizable and significant increase (67%) in the participation rate. This result is robust to alternative prize configurations. |