Summary
We investigate the impact of income distribution on lottery expenditures in Taiwan, using an agent-based model developed in [2, 3]. The agents in the model are potential lottery buyers, whose characteristics are described by three features: the percentage of income spent on the lottery, the preferences among lottery numbers selected and the aversion to regret. We used a genetic algorithm to drive the model simulation under agents with different incomes, based on household income data in Taiwan from 1979 to 2003. The simulation results indicated that the impact of income distribution on lottery sales is not significant. This might be due to the Taiwan economy having a minor degree of income variation which has a low effect on lottery expenditures.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Beenstock, M., Haitovsky, Y.: Lottomania and other anomalies in the market for lotto. Journal of Economic Psychology 22, 721–744 (2001)
Chen, S.H., Chie, B.T.: Lottery markets design, micro-structure, and macro-behavior: An ACE approach. Journal of Economic Behavior and Organization 67, 463–480 (2008)
Chen, S.H., Chie, B.T.: Agent-based modeling of lottery markets: Policy-making from the bottom up. In: Dennard, L., Richardson, K.A., Morcol, G. (eds.) Complexity and Policy Analysis-Tools and Concepts for Designing Robust Policies in a Complex World. ISCE Publishing (2008)
Clotfelter, C., Cook, P.: Selling Hope: State Lotteries in America. Harvard University Press, Cambridge (1989)
Kitchen, H., Powells, S.: Lottery expenditures in Canada: A regional analysis of determinants and incidence. Applied Economics 23(2), 1845–1852 (1991)
Deboer, L.: Lottery taxes be too high. Journal of Policy Analysis and Management 5(3), 594–596 (1984)
Farrell, L., Morgenroth, E., Walker, I.: A time series analysis of U.K. lottery sales: Long and short run price elasticities. Oxford Bulletin of Economics and Statistics 61(4), 513–526 (1999)
Farrell, L., Hartley, R., Lanot, G., Walker, I.: The demand for lotto: The role of conscious selection. Journal of Business and Economic Statistics 18(2), 228–241 (2000)
Hall, R.E., Lieberman, M.: Economics: Principles and Application, updated 2nd edn., pp. 365–367 (2003)
Holland, J.H.: Adaptation in Natural and Artificial Systems. University of Michigan Press, Ann Arbor (1975); MIT Press (2nd edn.)
Matheson, V.A., Grote, K.: Examining the ‘Halo Effect’ in Lotto Games. Applied Economics Letters 14(4-6), 307–310 (2007)
Statman, M.: Lottery players / stock traders. Financial Analysts Journal 58(1), 17 (2002)
Tesfatsion, L.: Agent-based computational economics: A constructive approach to economic theory. In: Tesfatsion, L., Judd, K.L. (eds.) Handbook of Computational Economics, Agent-Based Computational Economics. Handbooks in Economics Series, vol. 2. North-Holland, Amsterdam (2006)
Vrooman, D.H.: An economic analysis of the New York state lottery. National Tax Journal 4, 482–490 (1976)
Worthington, A.C.: Finance in gambling expenditures: Australian evidence on socioeconomic and demographic tax incidence. Public Finance Review 29(4), 326–342 (2001)
Zadeh, L.A.: Fuzzy sets. Information and Control 8, 338–353 (1965)
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2009 Springer-Verlag Berlin Heidelberg
About this chapter
Cite this chapter
Chen, SH., Chie, BT., Fan, HF., Yu, T. (2009). Income Distribution and Lottery Expenditures in Taiwan: An Analysis Based on Agent-Based Simulation. In: Brabazon, A., O’Neill, M. (eds) Natural Computing in Computational Finance. Studies in Computational Intelligence, vol 185. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-95974-8_10
Download citation
DOI: https://doi.org/10.1007/978-3-540-95974-8_10
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-540-95973-1
Online ISBN: 978-3-540-95974-8
eBook Packages: EngineeringEngineering (R0)