Charitable Lottery Structure and Fund Raising: Theory and Evidence

Do fixed-prize charitable lotteries generate more net revenue than do revenue-dependent lotteries? I present the results of an experiment designed to test a theoretical prediction of the relationship between the prize structure of a lottery funding a public good and individuals' participation in the lottery. I find that a fixed-prize lottery configuration induces significantly greater participation and a significantly higher level of public good funding than does a revenue-dependent lottery.