Gambling motivation and involvement: A review of social

equivalent to lowering the price of the lottery experience, and lower price results in
increased consumption.
Lottery operators may increase the price with the intention of making more
money, but this may be offset by lower sales. The British National Lottery appears
to have a near optimal balance between, on the one hand, ticket price and, on the
other, jackpot size and frequency [164]. Cross-elasticity has been found between
lotteries and horse racing in the USA, where the introduction of lotteries in some
cases has lead to a decline in wagering on horse racing [54, 163]. Advertising can be
expected to increase lottery sales and its extent can be used to measure sales elasticity.
An American study found advertising-related sales elasticity of lotteries to be
comparable to that of other consumer goods [165]. Another study, however, found
that lotto advertising on the radio and in newspapers had little effect on sales, while
jackpot size and TV publicity regarding jackpot winners had a relatively big effect
[166].
Some studies have found that the consumption of gambling products (lotteries
and slot machines) on mature markets follows a stochastic Negative Binomial Distribution
(NBD) pattern [167–169]. A large proportion of sales are accounted for
by a minority of the buyers – a phenomenon that in business is often referred to as
the “80–20” rule (where 80 percent of the products sold are bought by 20 percent
of the customers). The frequency of past purchases appears in these studies to be a
good predictor of the frequency of future purchases, which is interpreted to indicate
that much buying is habitual. Since the NBD pattern has been verified for many
different kinds of frequently-bought consumer products, the conclusion is that the
consumption pattern of gambling products does not indicate a significant element
of addiction or pathology.
Although some findings in this body of literature appear to be a bit conflicting,
the bulk of it suggests that consumption patterns for lotteries and some other forms
of gambling are similar to those of other consumer products. The addictive-like consumption
of gambling products by a tiny fraction of the population does not appear
to be visible in these kinds of economic studies. The great majority of consumers of
gambling products react as expected, according to economic models for rational and
utility-maximizing product choice, to variations in price and entertainment value.
There are, however, a few economic studies based on the theory of rational addiction
that have come to other conclusions. These will be discussed below. Finally, it
should be noted that a consumer perspective on gambling has implications for gambling
policy and the responsible provision of gambling – as consumer rights, choice
and protection come into focus [170, 171] – but this will not be discussed here.
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