Steven D. Moffitt, William T. Ziemba
arXiv 5 Jan 2018 · Econometrics
arXiv:1801.02958 · PDF · DOI · OpenAlex · Extracted main text
We report a new result on lotteries --- that a well-funded syndicate has a purely mechanical strategy to achieve expected returns of 10% to 25% in an equiprobable lottery with no take and no carryover pool. We prove that an optimal strategy (Nash equilibrium) in a game between the syndicate and other players consists of betting one of each ticket (the "trump ticket"), and extend that result to proportional ticket selection in non-equiprobable lotteries. The strategy can be adjusted to accommodate lottery taxes and carryover pools. No "irrationality" need be involved for the strategy to succeed --- it requires only that a large group of non-syndicate bettors each choose a few tickets independently.
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The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Ziemba, W. T., Brumelle, S. L., Gautier, A., and Schwartz, S. L (1986) Dr Z's 6/49 Lotto Guidebook self | 0.511 | 2 | 1 | 100% |
| 2 | Cook, P. J. and Clotfelter, C. T (1993) The peculiar scale economies of lotto | 0.405 | 1 | 1 | 100% |
| 3 | Ciecka, J. and Epstein, S (1996) State lotteries and externalities to their participants | 0.405 | 1 | 1 | 100% |
| 4 | Bernard, T. S (2013) Win a lottery jackpot? not much chance of that | 0.405 | 1 | 1 | 100% |
| 5 | Grote, K. and Matheson, V (2011) The economics of lotteries: A survey of the literature | 0.405 | 1 | 1 | 100% |
| 6 | Hausch, D. B., Ziemba, W. T., and Rubinstein, M (1981) Efficiency of the market for racetrack betting self | 0.405 | 1 | 1 | 100% |
| 7 | MacLean, L. C., Ziemba, W. T., and Blazenko, G (1992) Growth versus security in dynamic investment analysis self | 0.405 | 1 | 1 | 100% |
| 8 | Ziemba, W. T (2008) Chapter 10 - efficiency of racing, sports, and lottery betting markets self | 0.405 | 1 | 1 | 100% |
| 9 | Ziemba, W. T (2017) The Adventures of a Modern Renaissance Academic in Investing and Gambling self | 0.405 | 1 | 1 | 100% |
| 10 | Ziemba, W. T (2018) Exotic Betting at the Racetrack self | 0.405 | 1 | 1 | 100% |
Showing the top 10 of 14 scored citations.
arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.
| Citing paper | Intensity | Mentions | Sections | |
|---|---|---|---|---|
| 1 | 1801.02959 | 0.941 | 6 | 4 |