["Economic Inquiry, Volume 64, Issue 3, Page 886-894, July 2026. ", "\nAbstract\nWe assume that lottery participants are poor relative to their target income. Reference dependence with loss aversion can render the marginal utility of income non‐monotonic in line with the Friedman–Savage hypothesis. As a result, lottery participation can be rationalized without invoking probability weighting. The theoretical implications align with recent empirical evidence on lottery spending.\n"]