Pio is an economist educated in the US Ivy League, who serves his native island of Zoa in many capacities, including Director of the Lottery. I was introduced to him at a meeting of economists in Seattle, and he opened my eyes to a factor that drives our year-on-year increases in Instant game sales. Economists agree: if money is getting cheaper, it takes more of it to express the same value, year after year. NASPL Insights June 2015
I examined the recovery of the US instant business in particular, after instant sales in most jurisdictions were set back by the start of the Great Recession. I found that due to migration of the business to games of higher price point (and lower profitability), only in 2013 did the purchasing power of Net Win (or Gross Gaming Revenue) first exceed its pre-recession level. This work appeared in WLA US Lotteries winter 2014.
In Washington State, the lottery shares its sales forecasts with state economists, who are accustomed to forecasting all sorts of revenue of the basis of economic and population variables. Taking their lead, I found that I could account for a long, quarter-by-quarter history of instant game consumption on the basis of population, cost of living, unemployment, and so on- without taking into account anything that the lottery was doing. With forecasts of these driving variables, it is possible to make quarter-by-quarter forecasts of instant game consumption that are as accurate as other revenue forecasts. I apologize for the tight academic style of this article; I was still transitioning from hard science! NASPL Insights October 2011