Date of Award
1-1-2024
Document Type
Dissertation
Degree Name
Ph.D. in Economics
First Advisor
John Gardner
Second Advisor
Mark Van Boening
Third Advisor
Kenneth Rich
School
University of Mississippi
Relational Format
dissertation/thesis
Abstract
This dissertation explores how two major factors—gasoline prices and inflation—may influence state lottery revenues, with each factor examined in a separate essay. The first essay investigates the relationship between gasoline prices and lottery ticket revenues at gas stations. As the largest retailers of lottery tickets, gas stations play a crucial role in the lottery market. However, the relationship between gasoline prices and lottery ticket revenue has received very little attention. To address this gap, the essay analyzes weekly gas station-level data from four states—Texas, Florida, Illinois, and New York—over a 52-week period. The structural panel vector autoregression (PSVAR) approach yields three key findings. First, it reveals that changes in gasoline prices do not have an immediate impact on lottery ticket revenues in any given week. However, there is a significant relationship between lagged gasoline prices and lottery ticket revenue. Second, the effect of gasoline prices varies across different types of lottery games in the long run. Specifically, higher gasoline prices are associated with an increase in instant game revenue, while they lower draw game revenue. Lastly, the essay finds that draw game revenue is more sensitive to fluctuations in gasoline prices compared to instant game revenue.
The second essay empirically investigates the relationship between inflation and revenues from different types of lottery games across Core Based Statistical Areas (CBSAs). Monthly data from six CBSAs covering the period from January 2009 to December 2019 are used to estimate a fixed-effects panel model to account for time-invariant unobserved heterogeneity. The paper finds no significant relationship between inflation and lottery revenues when assuming uniform effects across the six CBSAs. However, after allowing the effects to vary by CBSA, the results suggest that higher inflation generally reduces revenue from instant games, while it increases revenue from draw games. The results highlight the importance of considering geographical differences when analyzing the impact of economic variables on lottery revenues and caution against generalizing findings from pooled data.
Recommended Citation
Ogunniran, Adedayo James, "Essays on State Lotteries" (2024). Electronic Theses and Dissertations. 3023.
https://egrove.olemiss.edu/etd/3023
