Parimutuel Lotteries: Gambler's Behavior and the Demand for Tickets

U. Hauser and Konig, U,

Working Papers from Washington St. Louis - School of Business and Political Economy

Abstract: In a parimutuel lottery, players face a strategic choice situation. We investigate how rational lottery players should choose combinations of numbers. Using data from the Austrian Lotto we compare this to actual behavior. We propose a relationship between the number of tickets and the expected loss of taking part based both on theoretical and empirical findings about player behavior. Rollovers introduce exogeneous price variation allowing to estimate properties of a demand function sensitive to the expected loss.

Keywords: CONSUMPTION; HAZARD; LOTTERIES (search for similar items in EconPapers)
JEL-codes: D12 L83 (search for similar items in EconPapers)
Pages: 19 pages
Date: 1999
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:fth:waslbp:9905

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