In a few words, yes, but with a twist: It depends who you ask and who’s talking: In a paper published this week in the Journal of Financial Economics, a group from Michigan State University and the University of Minnesota looked at this question using data from the National Longitudinal Surveys of Youth, beginning in 1992 and ending 2012. They found that those who had a higher self-assessed luck score in roulette were at higher risk of having bad financial outcomes as adults, though the reverse was true for people who had less luck.
“We found that people who had a higher chance of having a bad financial outcome as adults, even a small chance, also had lower income,” says lead author Mark W. Huber, MSU assistant professor of social, economic and behavioral sciences and of sociology. “We thought this may show a risk-seeking bias in gambling, that some people have a greater tendency to gamble if they think the outcome might be good and for which there is some degree of chance.” But while that sounds intuitive—after all, that’s what you hear about casinos, after all—it can be challenging to isolate the psychological phenomenon of the “luck-factor.”
It was Huber, who is also the Robert C. Stoll Professor of Economics at Michigan State and a former director of MSU’s Centre for Research in Social and Economic Change, who led the study. He says the fact that gambling involves skill, which is something most people can recognize, also helps. “The problem is that people with low self-assessed luck are often described as being stupid, and people who are much luckier might just be lazy,” Huber says. “We need to use this data set to determine whether luck has any role in outcomes for a subset of people.”
The results suggest that the effect of luck in life is not just a social construction, adds co-lead author David G. DellaVigna, professor of economics in MSU’s School of Public Affairs. “Lucky people might just be more successful at their activities.”
The authors looked at participants of the National Longitudinal Survey of Youth (NLSY), which has been in existence since 1991 and tracks 18 to 26-year-old Americans in an ongoing nationally representative sample. While the survey has been conducted in response to the government survey of adults, it has evolved over time from a general social science inquiry to a more focused economic study.
Their study looked at individuals from different income brackets who
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