Researchers at the University of Alberta in Canada and Georgetown University in the US found that neighbours of lottery winners have a higher probability of bankruptcy owing to increased conspicuous consumption, financial risk taking and borrowing.

    “Using lottery winnings as plausibly exogenous variations in the relative income of peers, we find that the dollar magnitude of a lottery win of one neighbor increases subsequent borrowing and bankruptcies among other neighbors,” a paper detailing the research states.



moslydeaf:

Placing the blame on lottery winners is a little silly in my opinion. I think it's dangerous to steal people's agency or deny them of it, maybe I'm wrong in holding that view though.

I do think the article is a good general reminder to stay within you means. As well as not compare your material success to others to such an extent that you make fiscally irresponsible decisions.


posted by francopoli: 18 days ago