Does the Lottery Target Low-Income People?
Lotteries have long been popular, and many good causes are funded through them. In fact, in the Old Testament, Moses divided land among the Israelites and later, the Roman emperors used lotteries to distribute slaves and property. Lotteries came to the United States during the colonial era, and were used to raise money for towns, wars, and public-works projects. However, the NGISC report does not provide any evidence that the lottery targets low-income individuals.
Currently, there are almost 186,000 retailers selling lottery tickets, according to the NASPL Web site. New York, Texas, and California have the most, with three-fourths of these outlets offering lottery services online. In addition to convenience stores, nearly half of lottery retailers are nonprofit organizations, service stations, restaurants, bars, and newsstands. In 2002, nearly $44 billion was wagered on lottery tickets. The sales of lottery tickets grew steadily between 1998 and 2003.
While lottery prizes can be incredibly large, they are not necessarily worth every penny. The New York Lottery, for example, buys special U.S. Treasury Bonds called STRIPS (Separate Trading of Registered Interest and Principal Securities). This is because STRIPS bonds carry zero-coupon rates, which means that the lottery will pay you back 100% of your winnings, after expenses. As such, the lottery can produce a substantial income if it’s managed properly.
Various studies have found that people who are low-income are more likely to play the lottery than those who are higher-income. The Vinson Institute of Government Studies at the University of Georgia reviewed many state and nationwide studies to confirm their findings. The researchers concluded that lottery participation was inversely related to education. Lower-income people were much more likely to play the lottery than those with more education. The highest lottery spending per capita was found in counties with large African-American populations.
One study examined the role of entrapment in lottery play. The study found that players become increasingly trapped in playing the same lottery numbers every week. They fear missing even one drawing. Moreover, it shows that players often experience near-misses, a common problem with lottery games. In addition to this, the study revealed that nearly sixty percent of people choose the same lottery numbers every week. Those who play the lottery frequently are not rewarded with the jackpot they expect.
Survey results show that men are more likely than women to purchase a lottery ticket. Singles are less likely to play than married individuals, and the lottery’s per capita spending is highest among those 45 to 64. Single respondents tend to spend less on the lottery than married people, and those without a high school diploma are more likely to play. In addition, lottery spending is higher among low-income households and those with no education. In fact, men are slightly more likely to purchase a lottery ticket than women.