Characteristics and responses of winners in the Greek tax lottery

The Greek tax lottery incentivises consumers to shift from cash to electronic payments by awarding €1,000 to 1,000 winners every month. Utilising administrative tax data, I analyse the income and occupation characteristics of winners, revealing that the lottery favours high-income taxpayers and the self-employed, who exhibit higher spending levels. Leveraging a unique event of retroactive draws in December 2017, I quantify the winners’ responses after receiving a prize. Low-to-middle-income taxpayers increase their electronic consumption temporarily, indicating that those who are less likely to win respond the most. Self-employed taxpayers with high spending levels halve their electronic consumption, suggesting that winning leads to higher perceived visibility of transactions by the tax authority. Using lottery simulations, I explore ticket ceilings that reduce the concentration of prizes among high-consumption individuals.