Detailed Findings and Methodology:
While many consider the lottery to be a game tailored to less educated, lower income individuals, the four states that spent the most money on lottery tickets in 2015 fly in the face of this assumption. In all four states, the adult population that has earned a college degree exceeds the national percentage. In fact, Massachusetts — the state with the highest lottery spending per adult — also has the highest level of educational attainment. A nation-leading 41.5% of Massachusetts adults have earned at least a bachelor’s degree, well above the national average of just 30.6%.
It may be that states with higher education levels have more residents who can afford to play the games. Americans with a college education are much more likely to earn higher wages and, as a result, have more disposable income to spend on lottery tickets. The typical household in Massachusetts has an annual income of over $70,000, almost $15,000 more than the national median household income.
Generally, the states in which people spend more on the lottery tend to pay out the most in total prizes. However, there are a handful of states with high ticket sales and relatively low total prize payouts. West Virginia is one of these states: In 2015 the average adult spent roughly $450 on lottery tickets but won only about $72. Rhode Island folk spent $640 on tickets on average but earned less than $180 in prizes.
Where the money from ticket revenue goes depends on the state. Proceeds can fund state-run programs such as education, veteran’s health, and parks, just to name a few. Education is often one of the primary beneficiaries: As of 2016, 15 states contribute all lottery proceeds to education.
To identify the states that spend the most money on lottery tickets, 24/7 Wall St. retrieved data from the American Community Survey’s 2015 Annual Survey of State Finances, which provides lottery ticket sales and the total amounts paid out in prizes. To determine total state spending and prizes paid per adult, we used 18 and over population figures from the Census’ Population and Housing Units Estimates. From the Census Bureau’s 2015 American Community Survey, we obtained additional demographic information, including median household income, and the share of the adult population with a bachelor’s degree. While 44 states currently host a lottery, data on one of these states — Wyoming — is not yet available, and so national totals refer to 43 states.