Gambling at Lucky Stores: Empirical Evidence from State Lottery Sales
American Economic Review
vol. 98,
no. 1, March 2008
(pp. 458-73)
Abstract
We show that the week after selling a large-prize Texas Lotto winning ticket, a retailer experiences a 12 to 38 percent relative increase in ticket sales. Some increase persists for up to 40 weeks. We document that the sales response increases with jackpot size and is larger in areas with more economically disadvantaged populations. Sales patterns across games and across retailers are not consistent with most advertising explanations. Furthermore, response patterns are not consistent with representativeness-based explanations for the hot hand or gambler's fallacy; we suggest an alternative explanation for the observed "lucky store" effect. (JEL H27, H71)Citation
Guryan, Jonathan, and Melissa S. Kearney. 2008. "Gambling at Lucky Stores: Empirical Evidence from State Lottery Sales." American Economic Review, 98 (1): 458-73. DOI: 10.1257/aer.98.1.458Additional Materials
JEL Classification
- H27 Taxation, Subsidies, and Revenues: Other Sources of Revenue
- H71 State and Local Taxation, Subsidies, and Revenue