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Factors influencing the adoption of state lotteries

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This paper explores the factors influencing the adoption of state lotteries in the United States. The conceptual framework utilizes a common utility framework in which a representative legislator maximizes utility derived from the current and expected fiscal position of a state, subject to a political constraint. The empirical results support the theoretical hypotheses, including the finding that changes in the fiscal health of the state, the predicted profit potential of a lottery, and the political climate of the state all affect the likelihood that a lottery is adopted. By introducing a sound conceptual framework, using better data than used in previous studies, utilizing an appropriate estimation technique, and obtaining strong results, this study advances our knowledge of why states adopt lotteries.

Document Type: Research Article


Publication date: July 1, 1999

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