Reducing ambiguity in lotteries: Evidence from a field experiment

Authors

REGGIANI Tommaso CONRADS Julian RILKE Rainer Michael

Year of publication 2015
Type Article in Periodical
Magazine / Source Applied Economics Letters
MU Faculty or unit

Faculty of Economics and Administration

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.

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