STEVE INSKEEP, HOST:
The NCAA men's basketball tournament being played this month involves several dozen teams and several hundred players. But countless other people also play at home. It is betting March Madness. And NPR social science correspondent Shankar Vedantam looked into some research into why exactly people bet on NCAA games. Hi, Shankar.
SHANKAR VEDANTAM, BYLINE: Hi, Steve.
INSKEEP: So wait a minute. People want to make money. I get that. It's an addictive activity of course. There's the thrill of winning, but you seem to be suggesting something else here.
VEDANTAM: Yeah, there's actually deeper puzzle that has bothered economists for a longtime, Steve, which is, why do people like to gamble at all? From the point of view of card-carrying economists, gambling is profoundly irrational because in most cases, it's a game that you're designed to lose. And yet, millions of people do it. I was speaking with Brad Humphreys, at West Virginia University, and he told me that although gamblers will tell you they are gambling to make money, that might not actually be the real reason. Here he is.
BRAD HUMPHREYS: I was trying to understand why it is that people would gamble. And one of the explanations out there is the idea that it's not a financial motive, that they get enjoyment out of it.
INSKEEP: What sort of enjoyment do you mean?
VEDANTAM: Humphreys, Rodney Paul and Andrew Weinbach decided to look at the NCAA to answer your question, Steve. They looked at the propensity of bettors to place bets on about 3,000 NCAA games. Now, fewer than 500 of those games are televised, and the researchers find bettors are significantly more likely to bet on games that are televised than on games that are not. Games with bigger television audiences get even more bets. Now, if you are just gambling to make money, why would you focus just on the games that are on television? Now, you can argue that people bet on games that are on television because these are better known teams. But the researchers apply all kinds of controls to make sure that familiarity or knowledge of the teams is not driving the phenomenon. What they conclude is that people are gambling because when they watch a game on TV, they get more enjoyment from the game knowing that they have a bet on the outcome. Humphreys and other economists believe this is actually a factor in much bigger settings, not just the NCAA. If you look at the stock market for example, economists have long observed that investors don't just focus primarily on returns. They certainly want their stocks to do well, but they also want stocks that make them feel better emotionally. Here's Humphreys again.
HUMPHREYS: I want to buy Apple stock, not because I think that it's going to be a profitable investment for me. But I want to buy Apple stock because I have an iPhone. And I get more satisfaction from using my iPhone knowing that I have a bet down, an investment, in Apple stock.
INSKEEP: I've put my money down on a story. And it's a story in which I participate by using the iPhone or watching a basketball game.
VEDANTAM: That's exactly right. And it's one of numerous areas where we assume that people are just behaving rationally, like conventional economic models would predict, whereas really, these psychological factors are driving their behavior.
INSKEEP: This, I think, helps to explain why it is that pro-sports leagues, like the NFL, have gone so all-in on sports betting sites, with fantasy football betting sites and so forth. The feeling is that the betting encourages viewing. The viewing encourages betting.
VEDANTAM: Humphreys told me exactly the same thing, Steve, which is when you look at it from the point of view of the NCAA, people placing bets on NCAA games only means that the engagement with the games is going to increase.
INSKEEP: Even though the college leagues are against betting.
INSKEEP: Shankar, thanks very much.
VEDANTAM: Thanks, Steve
INSKEEP: He is NPR's social science correspondent and also the host of the new podcast that explores the unseen patterns of human behavior, Hidden Brain.