When
China hit a record unemployment rate of 21% last year, a commentator on Weibo,
one of the country’s biggest social media platforms, observed: “The worse the
economy is, the more the sale of lottery tickets”. This observation echoes
findings from various studies that advocate during economic recessions, the
slight chance of winning a huge lottery prize becomes more attractive. The
societal impact of this is significant, as empirical studies consistently
reveal a positive association between unemployment and lottery sales: as the
unemployment rises, so do lottery sales, and vice-versa.
Lotteries,
one of the oldest and most widespread forms of gambling, trace their origins
back to ancient Rome and possibly even earlier to the Han Dynasty of China in
the second century B.C. In recent years, Sikkim has witnessed a significant
shift in this market. The lottery sellers in Gangtok were once familiar faces,
but now newcomers have flooded the market. Today, lottery-selling agents can be
seen even in the remotest corners of Sikkim. In Gangtok, a once-famous
Pan-Dokan (Pan Shop) now also serves as a lottery stall. Shops that once sold
souvenirs and other gift items have also transitioned, finding lottery sales
more economically viable.
I
recently spoke with a long-time vegetable vendor who has become a lottery
agent. He shared an interesting reason for his career change. He was spending
too much time on playing cards and so decided to sell lotteries to keep him
busy and fit. While doing so, he shifted the burden of wasted time and money
onto others. There are several stories of people losing substantial amounts in
lotteries and other forms of gambling.
Although
increased lottery ticket sales contribute to the Government’s coffer through
taxes, this remains one of the most unproductive economic transactions.
Lotteries create zero assets. They take money from millions of people to cover
administrative costs, pay agent commissions, keep significant margins, and
offer small prizes to a few lucky winners. This economic inefficiency should be
a cause for concern, as lotteries only sell hope.
The
proliferation of lottery stalls, agents, and giant advertisements in prime
locations across the state indicates a booming lottery business in Sikkim.
This growth in the sale of lottery tickets raises several pertinent
questions: Is this growth linked to rising unemployment in the state? Sikkim,
where the Government is the primary employer, recorded an unprecedented unemployment
rate of 21.70% last year. While recent temporary appointments by the Government
of Sikkim may have marginally reduced this rate, unemployment remains high.
Further, many of these jobs are low-paid, ranging between Rs. 9k to 15k. The
high unemployment rate, low-paid jobs, lack of business opportunities, and an
unskilled workforce create a fertile ground for lottery businesses and other
forms of gambling to thrive in the state.
Given
the weak winning probability, lotteries are regarded as a tax on people who are
bad at math, no matter why. Therefore, our youth must rely more on hard work
than on luck, as hard work can only genuinely overcome hard luck.
(Views are personal. Email: cbchhetri.ewa@gmail.com)
