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Substitute effects between Lotto and Big Lotto in Taiwan

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  • Chin-Tsai Lin
  • Chien-Hua Lai

Abstract

Lotto was inaugurated in January 2002 and immediately became a popular activity in Taiwan. The purpose of this investigation is to examine the effective price elasticity of Big Lotto and the substitute effects between Lotto (6/42) and Big Lotto (6/49). The analytical results can provide suggestions to the Taipei Bank on ways to improve lottery sales. The empirical findings of investigation include: (1) no significant substitutive or complementary relationships exist between Big Lotto and Lotto in Taiwan (2) the effective price elasticity of Big Lotto is -0.145, Taipei Bank can increase the revenue gained from Big Lotto by increasing the effective price.

Suggested Citation

  • Chin-Tsai Lin & Chien-Hua Lai, 2006. "Substitute effects between Lotto and Big Lotto in Taiwan," Applied Economics Letters, Taylor & Francis Journals, vol. 13(10), pages 655-658.
    • Handle: RePEc:taf:apeclt:v:13:y:2006:i:10:p:655-658
    DOI: 10.1080/13504850500401858
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    References listed on IDEAS

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    8. Scoggins, John F., 1995. "The Lotto and Expected Net Revenue," National Tax Journal, National Tax Association, vol. 48(1), pages 61-70, March.
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    Cited by:

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    2. Humphreys, Brad & Perez, Levi, 2011. "Lottery Participants and Revenues: An International Survey of Economic Research on Lotteries," Working Papers 2011-17, University of Alberta, Department of Economics.
    3. Orrin David Gulley, 2018. "The optimal structure of lotto games," Economics and Business Letters, Oviedo University Press, vol. 7(4), pages 156-161.
    4. Kent Grote & Victor Matheson, 2011. "The Economics of Lotteries: An Annotated Bibliography," Working Papers 1110, College of the Holy Cross, Department of Economics.
    5. Brad Humphreys & Levi Perez, 2012. "Network externalities in consumer spending on lottery games: evidence from Spain," Empirical Economics, Springer, vol. 42(3), pages 929-945, June.

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