How come there aren't any lottery start-ups?
There's lots of them. Most of them are ... not quite legal.
A game with a windfall for a knowing few
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Re: A game with a windfall for a knowing few
#12"As a result, sophisticated players do not actually want the jackpot to be paid out - unless it is going to them."
if they were truly sophisticated they would enjoy it just the same whoever it went to.
Re: A game with a windfall for a knowing few
#13How come there aren't any lottery start-ups?
While not legally gambling look at penny auctions. They are essentially a raffle and a ripe for governmemnt control.
Re: A game with a windfall for a knowing few
#14Earlier quoted context omitted.
Apparently, this particular lottery was created to pay out a bigger percentage of revenue than other lotteries. That is not entirely a bad idea: if people are going to gamble, it's better that they don't lose too much money. This particular scheme pays out most of the money to a select few, though, which defeats the point.
> This particular scheme pays out most of the money to a select few, though, which defeats the point. Does it? To me the only point of a lottery is for the operator to make a predictable profit; that predictability is why governments like them so much. Who wins the jackpot is pretty close to irrelevant.
Wait for the political fallout when the people funding the jackpots realize all their money is going to out-of-staters and they have no chance of winning anything, ever.
(Yes, I'm pretty sure that's how this will be reported in local media.)
Re: A game with a windfall for a knowing few
#15And thanks, boston.com, for spoiling it for everybody. No doubt the loophole will be closed now that it's out in the open.
Re: A game with a windfall for a knowing few
#16Didn't voltaire do this centuries ago?
Re: A game with a windfall for a knowing few
#17State-owned lotteries transfer wealth from one group of people to another group without any coercion. I don't see why private individuals can't participate in the transfers also. More generally, this is an example of how simple changes (the rolldown) can have surprising consequences. TBQH I'm surprised the lottery operators aren't just keeping the surplus funds rather than doing a "roll down".
They usually have to publish a payout rate, it is a common requirement for most forms of pure chance gambling. If people dont win you need some form of rollup. However if you keep it purely on the single big win it does not lead to schemes like this.
Plus when you fund larger and larger jackpots (by keeping the rollup purely on the single big win) you get more and more people buying more and more tickets.
I think Massachusetts would be likely to earn more money by being able to advertise a much, much larger jackpot and losing these "rollup day" "gamblers" (when your mathematical theoretical return is so far above 100%, I hesitate to call it gambling) but apparently they have some incentive to keep things the way they are (do lottery officials have relatives or buddies who are among those gaming the system?) because they've let this go on so long.
Re: A game with a windfall for a knowing few
#18And thanks, boston.com, for spoiling it for everybody. No doubt the loophole will be closed now that it's out in the open.
It's been written about before. I read about it in '08 or '09, and over the years have tried to find an article on it but those always come back with articles on scratch-off flaws.
Re: A game with a windfall for a knowing few
#19How come there aren't any lottery start-ups?
There are a few start-ups I know of that sell lottery technology/services to states, but afaik it's mostly dominated by big players and hard to break into.
Re: A game with a windfall for a knowing few
#20Earlier quoted context omitted.
They usually have to publish a payout rate, it is a common requirement for most forms of pure chance gambling. If people dont win you need some form of rollup. However if you keep it purely on the single big win it does not lead to schemes like this.
Plus when you fund larger and larger jackpots (by keeping the rollup purely on the single big win) you get more and more people buying more and more tickets. I think Massachusetts would be likely to earn more money by being able to advertise a much, much larger jackpot and losing these "rollup day" "gamblers" (when your mathematical theoretical return is so far above 100%, I hesitate to call it gambling) but apparent…
This is just one of many games in MA. There are other Major Jackpot games with huge payouts.