Abstract
Lotteries give states direct revenue from the commercial gambling market. Thirty-two states plus the District of Columbia, encompassing almost three-quarters of the population, operate games, a dramatic spread since the first modern lottery in New Hampshire (1964). These lotteries typically make only a small contribution to state finances, yield revenue that is subject to dramatic annual changes, are expensive to administer, and place relatively greater burdens on low income than on high income individuals. Proceeds are often dedicated to particular functions, but whether lottery proceeds do more than simply substitute for funds that the function would otherwise receive is doubtful. The fiscal limitations of lotteries have not dimmed the public popularity of the games.
Similar content being viewed by others
References
Borg, M.O. & Mason, P.M. (1988). The budgetary incidence of a lottery to support education.National Tax Journal, 41, 75–86.
Brinner, R.E. & Clotfelter, C.T. (1975). “An Economic Appraisal of State Lotteries,”National Tax Journal, pp. 395–404.
Christiansen, E.M. (1989, July 15). 1988 U.S. gross annual wagers,Gaming and Wagering Business, 8–22.
Clotfelter, C.T. (1979). On the regressivity of state-operated ‘numbers’ games,National Tax Journal, 543–548.
Clotfelter, C.T. & Cook, P.J. (1989).Selling hope. Cambridge; Harvard University Press.
Clotfelter, C.T. & Cook, P.J. (1987). Implicit Taxation in Lottery Finance,National Tax Journal, 40, 533–546.
Heavey, J.F. (1978). The incidence of state lottery taxes.Public Finance Quarterly, 6, 415–416.
Koza, J.R. (1982). The myth of the poor buying lottery tickets.Public Gaming, 10, 31.-40.
La Fleur, T. (1990, March 15–April 14) A North American lottery performance, significantly slower growth forces tight lid on ad expenses.Gaming and Wagering Business, 11, 37–41.
Langer, E.J. (1975). The illusion of control.Journal of Personality and Social Psychology, 32, 311–328.
Livernois, J. (1987). The redistributional effects of lotteries: Evidence from Canada,Public Finance Quarterly, 14, 339–351.
Mikesell, J.L. & Zorn, C.K. (1988) State lotteries for public revenue.Public Budgeting and Finance, 8, 38–47.
Mikesell, J.L. & Zorn, C.K. (1987). State lottery sales: Separating the influence of markets and game structure.Growth and Change,18.
Mikesell, J.L. & Zorn, C.K. (1986). State lotteries as fiscal savior or fiscal fraud: A look at the evidence.Public Administration Review, 46, 311–320.
Mote, R. (1984). Questions and Answers About a State Lottery. U.S. Congress, Senate Committee on Governmental Affairs, Subcommittee on Intergovernmental Affairs,State Lotteries: An Overview. 98th Congress, 2d Session, October 3.
Spiro, M.H. (1974). On the incidence of the Pennsylvania lottery.National Tax Journal, 26, 57–61.
Stacker, F.D. (1972). State sponsored gambling as a source of public revenue.National Tax Journal, 25, 437–441.
Suits, D.B. (1977). Gambling taxes: Regressivity and revenue potential.National Tax Journal, 30, 19–35.
U.S. Bureau of the Census. (1990).Government finances in 1987–88, GF-88-5, Washington: U.S. Government Printing Office.
U.S. lottery sales, calendar'89 (1990, February 15–March 14)Gaming and Wagering Business,11, page 30.
Vaillancourt, F. & Grignon, J. (1988). Canadian lotteries as taxes: Revenues and incidence.Canadian Tax Journal, 36, 369–388.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Mikesell, J.L. Lotteries in the state fiscal system. J Gambling Stud 6, 313–330 (1990). https://doi.org/10.1007/BF01014587
Issue Date:
DOI: https://doi.org/10.1007/BF01014587