Measuring the Impact of Lotteries on State per Pupil Expenditures for Education: Assessing the National Evidence

Abstract

State-operated lotteries have recently been asserted by public administrators and academicians as panaceas for eradicating revenue disparities existing across public school districts in the American states. The purpose of this research project is to empirically test the hypothesis that lottery revenues raise the state expenditures for public education. A state-level national dataset, which includes fifty American states over the period 1977-1997, was used for the analysis. Pooled time-series cross-sectional and ARIMA modeling was employed to test the hypothesis. This study finds that lottery revenues had a positive influence on state per pupil expenditures for education. The evidence for the impact of lotteries on state per pupil expenditures for education was robust and statistically significant. © 2005 by The Policy Studies Association. All rights reserved.