Nonlinear Effect of Business Cycle on Lottery Sales Stability

Po-Chin Wu, Hsiao, I-Chung, Tsai and Meng-Hua

Advances in Management and Applied Economics, 2018, vol. 8, issue 4, 3

Abstract: This paper constructs a panel smooth transition autoregression model to evaluate the impact of the U. S. business cycle on the stability of lottery sales. We find that the impact is nonlinear and time-varying, depending on the level of the leading indicator. The persistence of lottery sales locates between 0.7779 and 0.8539, implying that current lottery sales are influenced by about 15%-23% of current disturbance, and the stability of the lottery sales is relatively high. An increase in the leading indicator would lead to a higher persistence of lottery sales and then more stable lottery sales in the next period. JEL classification numbers: C23, L83, E32Keywords: Sales persistence, stability of lottery sales, panel smooth transition autoregression (PSTAR) model, lagged leading indicator

Date: 2018
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