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dot-org. Michael Carroll was in Lish garbage collector, who won 10 million pounds in the UK national lottery in 2002 that would have been worth around 20 million dollars. At the time, he became a tabloid newspaper celebrity for a while and was known as the king of the chavs, there was even a TV movie made about him in 2006. In an interview shortly after his Lottery Win.
Carol said that he would not be tempted into spending his money lavishly And the only wanted to buy a three-bedroom House near a lake where he could go fishing. That sounds like a good plan but it's not exactly the way things worked out. You don't usually get nicknamed, the king of the chives, while fishing quietly, at a lake. Carol quickly developed a taste for drugs alcohol and partying in 2005.
He was given 240 hours of community service after it was found that while drunk he had been Catapulting steel balls from his Mercedes van at parked cars and Shop Windows, you're not meant to do that. Almost any fisherman will tell you that catapulting steel balls from a van will scare the fish
away. It was noted in court that he had accumulated 42 offenses on his record by 2006 in May 2010 less than ten years after winning the lottery, Carol applied for his old job as a garbage collector again. Telling the press that he had, no regrets about the way in which he had spent his winnings in 2013. He spent three months in a hotel for the homeless after being
unable to find work. He's not the only lottery winner that ran into trouble in 2005. Roger and Laura Griffith, 11.8 million pounds on the UK National Lottery. They bought a big house and Roger got to record an album with the band he played with. It in University. The interest alone on the couple's lottery winnings would have earned the more than the median.
UK household income at the time. Some bad investments in failed business ventures, of course, followed in 2010, their house even burned down, they ended up divorced and by 2013 just eight years after the big lottery win, Roger had just seven pounds left in his bank account Evelyn Adams. Clerk in a convenience store, really beat the odds. She managed to win the New Jersey Lottery Twice, first in 1985. And again, in 1986 collecting a total of five point four million dollars.
She was the first person in the history of the New Jersey Lottery to win multiple million. Dollar jackpot prizes by 2012. Adams had spent all of her winnings, mostly gambling, her wealth away, at the tables in a Atlantic City casinos and squandering money on a string of unsuccessful business deals. Which included buying the convenience store that she used to work for today, she reportedly lives in the trailer.
We've all heard this type of story about how something like a lottery win which at first appeared to be a great blessing, slowly revealed itself to be a curse. The downward spiral in these stories is usually brought about by a number of Actors like winners partying and overspending investing their winnings, poorly, family and friends asking for handouts or even that the winner becomes a
mark for criminals and con man. We learn in these stories that for lottery winners life, without a job or responsibility, quickly becomes meaningless. They become distant from their true friends and soon lose everything. These types of scenarios. As we've just seen have all played out Out for many lottery winners but despite the curse that says winning the lottery will ruin your life.
A number of studies from around the world show that winning big cash prizes often leads to Big increases in life satisfaction over the long term, the lottery winners curse simply isn't true. So what does academic literature say about the curse of winning the lottery? Well the 2018 and be e or paper entitled. Total long-run effects of Lottery wealth on psychological well, being led by researchers with the Stockholm School of Economics.
Stockholm University and NYU studied 3000, Swedish lottery winners, who had worn a combined 277 million dollars between five and twenty. Two years earlier, the researchers asked them questions. Like all things considered, how happy would you say you are? And taking all things together in your life. How satisfied would you say you are with your life? These days, the participants reported being generally, more
satisfied with life. After winning the lottery large Prize winners reported experiencing sustained increases in overall life satisfaction that persist for over a decade and show no evidence of dissipating with time. According to the researchers. What about Mental health and happiness that according to the paper, no strong evidence was found that a lottery winners ended up being happier in the long run. But they did find strong
evidence. That the lottery winners were more satisfied with their lives years after winning. So what about the stories that a lottery wins is strange the winners from their friends? I think we can all. Imagine how that might happen, where your newfound wealth,
makes your friends jealous. Or maybe you just find yourself wanting to do new things that your old friends can't afford to do so you find new wealthier friends, friends who possibly don't understand you the way your old friends did. Well, a recent study from researchers at the London, School of economics and Warwick Business School finds that people who win more than 10,000 pounds on the lottery end up spending more time socializing with their friends and less time
talking. Into Neighbors after winning the lottery, the research finds that the more someone wins in the lottery. The more new friends, they're likely to make which they say, is consistent with the complementary effect of income, on the strength of social ties. The opposite is true with regards to social ties health for More instrumental reasons such as talking to neighbors winning more. And a lottery reduces the size of an individual. Port Network and this is not
overly surprising. As wealthier people don't tend to rely on their friends and family as much for support as poor people, do the social ties that get broken are different to friendships their social ties that are primarily useful for practical reasons and require little emotional investment. These are apparently often substituted away with an
increase in income. According to a 2016 paper by Bianchi and Voz higher, socioeconomic status individuals, prioritize social ties that are not necessarily valuable for resources. But instead for emotional well-being, tests for robustness. In the study found that average lottery. Winner effects tend to be skewed by the really big Winners suggesting that small to medium-sized wins below 10,000. Pounds or dollars are often not enough to change people social
ties in a meaningful manner. According to the paper increases in income can have a number of significant consequences on social behavior. First day of an impact on the resources available for creating and maintaining social networks. Basically wealthier people have more time and money to socialize
and so they socialize more. Secondly Increases in income have the potential to influence social consumption, Which lubricates social relationships essentially, as people's wealth grows, they can better afford to choose where to go and who to spend time with and it's only so surprising based on all of this, that lottery winners, spend more time with close friends and less times with neighbors and acquaintances after their big
win. A vast, literature exists, showing the strong A positive relationship between income and good health, and a strong negative association with mortality. The direction of causality, is however more dubious, do people become wealthier because they have good health to start with, or are wealthy people healthier because their wealth by has greater access to resources like good food, gyms and Healthcare a 2002. Paper called estimating the effect of income.
Health, and mortality using Lottery prizes as exogenous source of variation in income found the lottery winners tend to be healthier and live longer than on lottery winners, 2022 paper called income, Wind Falls, and overweight evidence from Lottery wins found that in the UK, a 1,000-pound lottery. When reduces the risk of an individual being overweight. Long, low educated individuals by four and a half to five percentage points. 12 months after the lottery win,
maintaining a healthy weight. May of course, be a luxury good. The wealthy may have better access to Fresh Foods gym, memberships and housing and healthy environment or hiring come individually. Might moderate their weight and strive to be healthier as they compare themselves to other people who were in better shape. But one way or Another. According to this research Lottery winds, tend to be correlated with better overall health, and a healthier body
mass index. So, why do we believe that everything ends horribly for lottery winners then? Well to start with, it might just feel good for people to believe that great wealth which seems Out Of Reach will only bring bad things. But in most articles about the lottery winners curse, there's a frequently cited statistics From the National Endowment for financial education, which states? That 70% of lottery winners go bankrupt just a few years after winning.
It's worth clarifying. That in 2018, the any, Fe came out with a press release saying that those numbers were not backed up by any research, a study looking at 35,000 Florida Lottery winners, the craziest kind of lottery winners found that only 6% of the code. Hard later filed for bankruptcy. That is a lot less than the 70% that is frequently reported the Swedish study that I mentioned earlier. Showed that most lottery winners don't blow through their
winnings. And in fact, they usually don't even quit their jobs. The researchers found that people who want large sums of money. Were typically, still wealthier, 10 years, after their win, compared to people who wouldn't small sums of Money Lottery. Jackpot winners do typically cut down on the hours. They work after the win but they do this. Mostly by taking a longer vacations, the Swedish study only studied lottery winners who wouldn't between 100,000 dollars
and two million. There are prices that are much larger than that around the world and really huge. Prices might have really different effects. The Florida Lottery. Winners study did find that lottery winners in General was slightly more likely than the average person to eventually file for bankruptcy but that bankruptcy was still an unusual outcome for this group. Interestingly the size of the Wind made no difference in the
probability of a lottery winner. Filing for bankruptcy, it's maybe not too surprising that people who played a lottery or who gamble in general are more likely to go bankrupt and average research shows that the bottom Three quintiles in socioeconomic status, spent the most on lottery tickets and the highest socio-economic group spent, the least, on the lottery Evelyn Adams, the woman who won the New Jersey Lottery twice, before losing all of her money, allegedly spent $25 per week on
lottery tickets for several years before her first win. After the first win, she upped her weekly spending to a hundred dollars per week on Do you take it before? Winning again, the odds of winning the first jackpot were worn in 3.2 million. The second one in 5.2 million. I guess the true story is a little bit less exciting than the one that most people believe, lottery winners. Usually don't go nuts. Quit their jobs and blow all the
money. They typically get healthier Slimmer and use their Good Fortune to increase their financial Security to take more holidays and to spend more time with their closest friends. Thanks for tuning in to this week's podcast. If you have a friend who you think might enjoyed, please send them a link, an extra special, thanks to my patreon supporters, who support makes this podcast happen. Have a great day and talk to you again soon. Bye. If you enjoyed this episode, be sure to subscribe.
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