13
views
0
recommends
+1 Recommend
1 collections
0
shares
• Record: found
• Abstract: found
• Article: found

# The Powerball Regressivity: An Evidence from the World's Largest Lottery Prize

1 , 2 , 3 , 4

The University of Buckingham

ScienceOpenPublisher
Bookmark
There is no author summary for this article yet. Authors can add summaries to their articles on ScienceOpen to make them more accessible to a non-specialist audience.

### Abstract

On January 13, 2016, the largest jackpot prize in world history took place.  In this paper, we examied the Powerball's regressivity from the 16th drawing with a jackpot prize of $301.8 million to the 20th drawing with a jackpot prize of$1.5 billion.  These last five drawings allowed us to examine whether the regressivity continues to decline and turns progressive as jackpot levels approach the billion-dollar mark.  Our sample include Powerball sales from 44 states and the District of Columbia.  Since the cost of living varied across states/jurisdictions, we used real lottery and income data to estimate income elasticity.  For the 16th through 18th drawings, there is a positive relationship between jackpot level and income elasticity.  However, on the 19th drawing with a jackpot of \$949.8 million, the income elasticity declined to 0.554 from 0.900.  On the 20th drawing, the income elasticity increased to 0.649 but remained below 0.900 reached on the 18th drawing.

### Author and article information

###### Journal
The Journal of Gambling Business and Economics
The University of Buckingham
11 October 2019
: 12
: 1
: 49-64
###### Affiliations
[1 ] Loyola University Chicago
[2 ] Suffolk University
[3 ] Rider University
[4 ] Handong Global University
###### Article
10.5750/jgbe.v12i1.1489