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Running the Numbers on Lotteries and the Poor: An Empirical Analysis of Transfer Payment Distribution and Subsequent Lottery Sales

  • Andrew Weinbach


  • Rodney Paul


State lottery revenues are shown to increase during the week transfer payments are distributed. The timing of the increase in lottery purchases suggests a portion of the transfer payments is used to purchase lottery tickets. In addition to providing information on the timing of lottery purchases, this study finds sales of Pick 3 and Pick 4 tickets increase during the period, while sales of Pick 5 and Pick 6 games do not, suggesting a general preference for the relatively higher probability, smaller jackpot games for the group. Copyright International Atlantic Economic Society 2008

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Article provided by International Atlantic Economic Society in its journal Atlantic Economic Journal.

Volume (Year): 36 (2008)
Issue (Month): 3 (September)
Pages: 333-344

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Handle: RePEc:kap:atlecj:v:36:y:2008:i:3:p:333-344
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  1. Melvin Stephens Jr., 2002. "'3rd of tha Month': Do Social Security Recipients Smooth Consumption Between Checks?," NBER Working Papers 9135, National Bureau of Economic Research, Inc.
  2. Barrow, Lisa & McGranahan, Leslie, 2000. "The Effects of the Earned Income Credit on the Seasonality of Household Expenditures," National Tax Journal, National Tax Association, vol. 53(n. 4), pages 1211-44, December.
  3. Zeldes, Stephen P, 1989. "Consumption and Liquidity Constraints: An Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 97(2), pages 305-46, April.
  4. Farrell, Lisa & Walker, Ian, 1999. "The welfare effects of lotto: evidence from the UK," Journal of Public Economics, Elsevier, vol. 72(1), pages 99-120, April.
  5. Glenn R. Hubbard & Jonathan Skinner & Stephen P. Zeldes, . "Precautionary Saving and Social Insurance," Rodney L. White Center for Financial Research Working Papers 3-95, Wharton School Rodney L. White Center for Financial Research.
  6. Donald I. Price & E. Shawn Novak, 2000. "The Income Redistribution Effects of Texas State Lottery Games," Public Finance Review, , vol. 28(1), pages 82-92, January.
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