The Growing Popularity of the Lottery

The Growing Popularity of the Lottery

Did you know that some states started a lottery? Florida, Idaho, and Kansas were among the first to begin selling tickets in the 1890s. After Colorado, Florida, and Indiana, Missouri, Kansas, and Oregon followed suit. South Dakota and Virginia also started the lottery in the 1890s. Today, Washington state, New Mexico, and Texas have lottery programs. In each of these states, lottery sales have grown rapidly. Listed below are some interesting statistics.

Incidence of lottery play on lower-income people

The incidence of lottery play among lower-income people has been decreasing in recent years, according to a Gallup survey conducted June 14-23, 2011. This drop may be due to a variety of factors, including the widening range of other gambling options, and critics of state-sponsored lotteries who say they prey on disadvantaged groups. But lottery winnings can still be attractive to low-income Americans.

While lottery play is common among lower-income people, many poor households are willing to spend money on it. They may view it as an investment to get out of poverty. In fact, nearly half of lottery ticket sales in North Carolina come from poor households, with nearly one third of low-income households contributing more than half of all tickets sold. A North Carolina policy watch study found that 18 of the 20 counties with higher poverty rates exceeded the average statewide lottery ticket spending by adult players.

Impact of lottery on prekindergarten programs

Boston has recently experimented with a lottery to enroll children in prekindergarten programs. While the lottery isn’t completely open, most campuses give preference to students who live in nearby neighborhoods. The in-boundary preference gave nearly half of three and four-year-olds a leg up in applying to a particular prekindergarten program. Researchers have been tracking the cohort of lottery-winners and losers from the 2009-10 to 2010-11 school years, comparing their outcomes with those of lottery-losers.

The Georgia Budget and Policy Institute is grateful to the directors of prekindergarten programs for their generous input. Respondents provided extensive data, thoughtful responses, and wise feedback. The names of the respondents have been changed with their permission. These quotes reflect the views of those who lead these programs and have the most knowledge about their particular situation. The research team hopes to continue to provide valuable information to Georgia parents and community members. It’s important to remember that the lottery is not a substitute for a prekindergarten program.

Impact of lottery on retail outlets

The lottery is one of the most popular entertainments in the U.S., with nearly $64 billion in sales last year. Most of that revenue came from c-stores. And nearly 90 percent of retailers are seeing potential growth for the lottery in their stores. In fact, four out of five reported sales increases when jackpots were high. However, this growth isn’t translating into a large economic impact for retailers.

This overconcentration of lottery retailers may explain why lottery play is more concentrated in lower-income neighborhoods. For example, the convenience store where Standifer purchased her scratch-off ticket is located in a low-income neighborhood with a three-fold poverty rate and a 25-percent higher percentage of Black residents. And in the 28 adjacent neighborhoods, stores selling lottery tickets had nearly double the poverty rate and a lower median household income than those without lottery retailers.

Marketing to lower-income people

One way to market a lottery to lower-income people is to target those who are most likely to buy tickets. In the case of lottery purchases, mass media advertising has a large impact on people’s perception of the lottery. In Maryland, an audit suggested analyzing the market to determine the most effective games and strategies. In Virginia, officials considered marketing to Generation X. This study provided insights into how to target lottery purchasing to lower-income people.

Lottery officials contend that marketing to lower-income populations is counterproductive because most people buy tickets outside of their own neighborhoods. But this would be counterproductive if the lottery were aimed at lower-income people. Research shows that most lottery consumers live in high-income areas and pass through low-income ones. This means that lottery outlets are almost non-existent in low-income neighborhoods. In fact, the number of lottery players in low-income neighborhoods is largely inconsequential.