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Several states, including Texas, use the lottery to raise funds for their general revenues. Discuss briefly the following issues related to using lotteries as a source of funding using scholarly resources:
A) What are the costs and benefits of using the lottery as a source of revenue from an economic efficiency perspective?
B) What are the socio-economic characteristics of the buyers of the lottery tickets generally, and in Texas in particular.
C) How much does an average buyer spend on lottery tickets and what are the opportunity costs of using these funds?
D) Taking information from (a) and (c), discuss if lottery collections from the state’s perspective are income-neutral or regressive (which group is carrying a disproportionate share of the burden)?
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