Seeking Leviathan? A test of the revenue maximisation objective in the South African National Lottery

Abstract

A Leviathan is an inefficient government that maximises the public revenue it raises. This article seeks evidence of a Leviathan in the South African government in respect of the National Lottery. This search is motivated by the Lotteries Act of 1997 which legislates that the goal of the National Lottery is to maximise the public revenue raised from the sale of National Lottery tickets. The effective price model is used to estimate the demand curve for National Lottery tickets. Although the National Lottery is not yet maximising revenue, the actions of the National Lottery suggest seemingly Leviathan tendencies.