It's unclear that this was entirely unintentional on the part of the state lottery officials. The report certainly seems to conclude that the lottery attracted a large volume of bets, just as desired. It says that the state made money on this, too... though I don't quite understand how. Clearly someone had to lose money.
It says that the state made money on this, too... though I don't quite understand how.
The state takes $0.40 of every ticket bought off the top. The betting pools bought tickets above and beyond what the "regular" customers would buy when the jackpot was getting close to $2 million dollars. These are tickets the lottery would not have sold otherwise more than likely. (The kind of people who buy massive amounts of tickets when they actually have an edge in the odds are also the kind of people who buy NO tickets when they do not have an edge....
"In 2005, Dr. Zhang was having an ongoing discussion with friends about the Lottery, with Dr. Zhang taking the view that it offered poor odds and was a tax mainly on poor people. To bolster his argument, he began analyzing the Massachusetts Lottery’s various games. But when he got to Cash WinFall, he was shocked to find that during roll-down drawings the odds were in the bettor’s favor."
Full story here - it's rather engrossing.
http://www.mass.gov/ig/publications/reports-and-recommendations/2012/lottery-cash-winfall-letter-july-2012.pdf