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What drives lottery demand? Evidence from China's lottery practice
Jia Yuan1; Jason Z. Gao2
2015
Source PublicationINTERNATIONAL GAMBLING STUDIES
ISSN1445-9795
Volume15Issue:1Pages:159-178
Abstract

As governments draw increasing revenues from the lottery industry, it has become academically important, as well as for policy purposes, to better understand the factors that can explain lottery purchase decisions. The traditional literature uses either the expected return of each lottery ticket (effective price approach) or the jackpot size (jackpot approach) to explain the variation in lottery demand. In this article, we examine these two factors by exploiting a unique lottery game set-up in lottery practice in China. This lottery game is similar to lotteries in other countries except that there is a cap policy on the grand prize, which limits the reward of each jackpot winner. We show that this complex cap policy actually causes both the lottery effective price and the jackpot size to remain almost fixed for the majority of the time while lottery demand significantly fluctuates. The lack of variation suggests that, in China’s practice, neither the effective price nor the jackpot size can explain the observed variation in lottery sales. Instead, we find that the size of the lottery rollover fits well in explaining the variation in lottery demand.

KeywordLottery Demand Chinese Lottery
DOIhttps://doi.org/10.1080/14459795.2014.1003316
Indexed BySSCI ; SSCI
Language英语
WOS Research AreaSubstance Abuse
WOS SubjectSubstance Abuse
WOS IDWOS:000353171700016
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Cited Times [WOS]:0   [WOS Record]     [Related Records in WOS]
Document TypeJournal article
CollectionFaculty of Business Administration
DEPARTMENT OF FINANCE AND BUSINESS ECONOMICS
Corresponding AuthorJia Yuan
Affiliation1.Faculty of Business Administration, University of Macau, Taipa, Macau
2.School of Math and Statistics, Carleton University, Ottawa, Canada
First Author AffilicationFaculty of Business Administration
Corresponding Author AffilicationFaculty of Business Administration
Recommended Citation
GB/T 7714
Jia Yuan,Jason Z. Gao. What drives lottery demand? Evidence from China's lottery practice[J]. INTERNATIONAL GAMBLING STUDIES,2015,15(1):159-178.
APA Jia Yuan,&Jason Z. Gao.(2015).What drives lottery demand? Evidence from China's lottery practice.INTERNATIONAL GAMBLING STUDIES,15(1),159-178.
MLA Jia Yuan,et al."What drives lottery demand? Evidence from China's lottery practice".INTERNATIONAL GAMBLING STUDIES 15.1(2015):159-178.
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