Debiasing on a Roll: Changing Gambling Behavior Through Experiential Learning

43 Pages Posted: 20 Apr 2016

See all articles by Martin Abel

Martin Abel

Harvard University

Shawn Allen Cole

Harvard Business School

Bilal Zia

World Bank - Development Research Group (DECRG)

Date Written: February 1, 2015

Abstract

This paper tests experiential learning as a debiasing tool against gambling and lottery behavior in South Africa. The study implemented a simple, interactive dice game that simulates worsening winning odds of rolling sixes as more dice are added to the game. The analysis exploits two levels of exogenous variation, first from random assignment into the debiasing game, and second from the number of rolls it takes to obtain the sixes. Treated individuals who needed above-median number of rolls to obtain simultaneous sixes are significantly less likely than the control group to gamble or play the lottery in the following year. The converse is true for individuals who needed below-median number of rolls, suggesting a perverse treatment effect among this group. The analysis also finds suggestive evidence that the debiasing affected the sensitivity to varying winning odds. Changes in entertainment utility or risk preferences cannot explain these findings, rather the results are consistent with changes in risk beliefs.

Keywords: Inequality, Educational Sciences

Suggested Citation

Abel, Martin and Cole, Shawn Allen and Zia, Bilal, Debiasing on a Roll: Changing Gambling Behavior Through Experiential Learning (February 1, 2015). World Bank Policy Research Working Paper No. 7195. Available at SSRN: https://ssrn.com/abstract=2579890

Martin Abel (Contact Author)

Harvard University ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States

Shawn Allen Cole

Harvard Business School ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

Bilal Zia

World Bank - Development Research Group (DECRG) ( email )

MC3-445
1818 H Street, N.W.
Washington, DC 20433

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