Taking into account the revenues, consumer surplus, purchasing patterns by income, and possible consumer biases, state-run lotteries (such as Powerball and scratch-off games) increase social welfare.
Responses
© 2025. Kent A. Clark Center for Global Markets.
2%
5%
2%
28%
40%
23%
0%
Responses weighted by each expert's confidence
© 2025. Kent A. Clark Center for Global Markets.
4%
37%
41%
18%
0%
Participant |
University |
Vote |
Confidence |
Bio/Vote History |
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![]() Daron Acemoglu |
MIT | Bio/Vote History | ||
They are regressive taxes. Only excuse might be otherwise the private sector will offer them and capture the revenues. Yet not convincing
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![]() Alberto Alesina |
Harvard | Bio/Vote History | ||
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![]() Joseph Altonji |
Yale | Bio/Vote History | ||
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![]() Alan Auerbach |
Berkeley | Bio/Vote History | ||
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![]() David Autor |
MIT | Bio/Vote History | ||
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![]() Katherine Baicker |
University of Chicago | Bio/Vote History | ||
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![]() Abhijit Banerjee |
MIT | Bio/Vote History | ||
I think people's preferences are often locally convex, so they may actually want lotteries. On the other hand probabilities are confusing
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![]() Marianne Bertrand |
Chicago | Bio/Vote History | ||
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![]() Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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![]() Raj Chetty |
Harvard | Bio/Vote History | ||
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![]() Judith Chevalier |
Yale | Bio/Vote History | ||
Obviously there are real issues here regarding addiction, progressivity, etc.
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![]() David Cutler |
Harvard | Bio/Vote History | ||
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![]() Angus Deaton |
Princeton | Bio/Vote History | ||
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![]() Darrell Duffie |
Stanford | Bio/Vote History | ||
Such lotteries exploit behavioral gambling, causing, in effect, a regressive tax. Not welfare increasing, given alternative funding sources.
-see background information here |
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![]() Aaron Edlin |
Berkeley | Bio/Vote History | ||
Addiction and consumer bias could mean that the product decreases welfare. But does it crowd out even worse gambling and associated crime?
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![]() Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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![]() Liran Einav |
Stanford | Bio/Vote History | ||
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![]() Ray Fair |
Yale | Bio/Vote History | ||
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![]() Amy Finkelstein |
MIT | Bio/Vote History | ||
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![]() Austan Goolsbee |
Chicago | Bio/Vote History | ||
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![]() Michael Greenstone |
University of Chicago | Bio/Vote History | ||
Welfare impacts (+ & -) from state lotteries are probably much smaller than in past due to proliferation of alternative ways to gamble
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Robert Hall |
Stanford | Bio/Vote History | ||
I'm inclined to think that government should not exploit the public's vulnerability to gambling, but I'm also aware of counter-arguments.
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![]() Oliver Hart |
Harvard | Bio/Vote History | ||
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![]() Bengt Holmström |
MIT | Bio/Vote History | ||
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![]() Caroline Hoxby |
Stanford | Bio/Vote History | ||
The answer requires still-undone estimation of elasticities, incidence, & g.e. effects. Not to mention an SWF. Just silly to be certain.
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![]() Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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![]() Kenneth Judd |
Stanford | Bio/Vote History | ||
Lotteries were oversold when introduced but there is a demand for this product and little evidence that consumers are involuntarily harmed.
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![]() Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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![]() Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
Kearney "to what extent [is] the increase in consumer utility and public revenue offsets the associated social costs" still not sure we know
-see background information here |
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![]() Pete Klenow |
Stanford | Bio/Vote History | ||
![]() Jonathan Levin |
Stanford | Bio/Vote History | ||
Can't say I have a strong view here, but people choose whether to participate, and the revenues are used for schools, roads...
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![]() Eric Maskin |
Harvard | Bio/Vote History | ||
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![]() William Nordhaus |
Yale | Bio/Vote History | ||
Among the worst of social policies.
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![]() Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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![]() Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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![]() Larry Samuelson |
Yale | Bio/Vote History | ||
Lotteries are a regressive tax. The welfare effect depends on your social welfare function; for mine regressive taxes reduce welfare.
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![]() José Scheinkman |
Columbia University | Did Not Answer | Bio/Vote History | |
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![]() Richard Schmalensee |
MIT | Bio/Vote History | ||
People seem to enjoy participating, which is more than one can say about taxes. But biases and addiction reduce my confidence about the net
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![]() Carl Shapiro |
Berkeley | Bio/Vote History | ||
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![]() Robert Shimer |
University of Chicago | Bio/Vote History | ||
If there were no state-run lotteries, more private institutions would enable possibly-biased consumers to gamble
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![]() James Stock |
Harvard | Bio/Vote History | ||
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![]() Richard Thaler |
Chicago Booth | Bio/Vote History | ||
States giving themselves a monopoly in this business is bad for sure, but if the alternative is prohibition is that better?
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![]() Christopher Udry |
Northwestern | Bio/Vote History | ||
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