TY  - JOUR
AU  - Yu,Kam
TI  - Measuring the Output and Prices of the Lottery Sector: An Application of Implicit Expected Utility Theory
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 14020
PY  - 2008
Y2  - May 2008
UR  - http://www.nber.org/papers/w14020
L1  - http://www.nber.org/papers/w14020.pdf
N1  - Author contact info:
Kam Yu
Lakehead University
E-Mail: kam.yu@lakeheadu.ca
M1  - published as Kam Yu. "Measuring the Output and Prices of the Lottery Sector: An Application of Implicit Expected Utility Theory," in W. Erwin Diewert, John S. Greenlees and Charles R. Hulten, editors, "Price Index Concepts and Measurement" University of Chicago Press (2009)

M3  - presented at "CRIW and SSHRC: Price Index Concepts & Measurement", June 28-29, 2004
AB  - Using implicit expected utility theory, a money metric of utility derived from playing a lottery game is developed. Output of the lottery sector can be defined as the difference in utility with and without the game. Using a kinked parametric functional form, outputs of the Canadian Lotto 6/49 are estimated. Results show that this direct economic approach yield an average output which is almost three times of the official GDP, which takes total factor costs as output. A by-product of the estimation is an implicit price index for lottery, which can serve as a cost-of-living index for the CPI. The estimated price elasticity of demand -0.67 closely resembles results for the U.K. and Israel in previous studies.
ER  -