Social ties play an important role in providing individuals with emotional and physical support, as well as helping to form social groups. But maintaining these social ties requires investment in the form of time, effort, and psychological resources.
Building connections with neighbours is one way to strengthen ties to society at large, which can have a positive impact on overall well-being. It is important to note that not all social ties are equally influenced by economic factors or emotional connections, and the level of investment required may vary.
A recent study conducted in the UK explored the relationship between lottery wins and social ties, including support networks, and their impact on overall well-being. The findings, published in the journal Rationality and Society, suggest that not all social ties are equally influenced by economic factors or emotional connections, and the level of investment required may vary.
The study revealed that individuals who win more in the lottery are more likely to meet with friends on a regular basis, suggesting that a positive income shock can help individuals enhance their social ties and potentially make new ones. But social ties based on instrumental reasons, such as talking to neighbours, did not show the same correlation.
Consistent with theories of investment and attraction effects, the study found that lottery winnings have a positive and statistically significant impact on meeting with friends on most days while having a negative and statistically significant effect on talking to neighbours and support networks. Specifically, a £1,000 increase in winnings leads to a 0.4 percentage point increase in the likelihood of meeting friends on most days, while reducing the probability of talking to neighbours on most days by approximately the same amount, with an estimated marginal effect of –0.5 percentage points.
The analysis further indicates that income replaces the strength of instrumental social ties and an individual’s reliance on their support network, which supports the hypothesised resource constraint theory. But the impact of lottery wins on social ties was primarily driven by individuals who had very large wins. Small to medium-sized wins (below £10,000) may not have a significant impact on an individual’s social ties or support network.
The study highlights the potential trade-off between investing time in nurturing social ties and pursuing higher income for increased life satisfaction. The findings suggest that future research with a larger sample of big lottery winners may provide a more accurate estimate of the turning point for the effects of lottery wins on social ties.
To further investigate the effects of smaller wins, a more refined measurement of social engagement, such as the number of hours spent with friends and family, may be necessary. Additionally, the researchers suggested that changes in behaviour resulting from large wins may be due to overconfidence rather than pure wealth.