Lotteries are one clear example where many people ignore the expected value of
their cough investment—although the case presented here may be an
exception.
Anyway, a very other common form of lottery is called insurance. There, as
well, your expected values is negative, still, most people do get (voluntarily,
and sometimes involuntarily) insurances. If you had a million houses, it would
make little sense to buy fire insurance for them.
I would argue that the expected value is too limited a criterion for
rationality; we’d also have to include the subjective feelings of security
(insurance) or possible fortunes (lotteries).
Lotteries are one clear example where many people ignore the expected value of their cough investment—although the case presented here may be an exception.
Anyway, a very other common form of lottery is called insurance. There, as well, your expected values is negative, still, most people do get (voluntarily, and sometimes involuntarily) insurances. If you had a million houses, it would make little sense to buy fire insurance for them.
I would argue that the expected value is too limited a criterion for rationality; we’d also have to include the subjective feelings of security (insurance) or possible fortunes (lotteries).