Lotto Sales Stagnation: Product Maturity or Small Jackpots?

Abstract

ABSTRACT New York State lotto data are examined to determine whether the sales slowdown experienced by many state lotteries between 1985 and 1987 was due to a decline in interest by bettors or to a scarcity of large jackpots. Regression analysis shows that lotto sales accelerate as jackpots grow. Rising bettor participation causes fewer rollovers and smaller jackpots; this was the primary cause of the sales slowdown in New York. Increasing the odds against winning generates larger prizes and sales growth.