Date of Award

Summer 1997

Document Type


Degree Name

Doctor of Business Administration (DBA)


Marketing and Analysis

First Advisor

Lawrence C. Smith


The study was undertaken to decide whether lottery revenues impacted teachers' salaries in Louisiana. Economic recession brought on by the collapse of the oil and gas industry, disgruntled taxpayers, and the lure of easy money prompted Louisiana legislators to pass a bill adopting a state lottery. Initially, all funds were earmarked for education. Subsequently, lottery revenues were deposited into the general fund. Yet many thought the lottery would be a significant source of money for education and teachers' salaries.

Logged annual salaries were used in models for university teachers and for elementary and secondary school teachers. Variables were incorporated to control for demographic and economic characteristics. Two theoretical models were used to show how the demographic and economic characteristics explained the variation in annual teachers' salaries.

Variables in the final model for university teachers were degree, discipline, total university experience, total years of teaching experience, rank, university, university system, regions of the state, and lottery revenues. Variables in the elementary and secondary teachers' model included classification variables for degree held, years of experience, lottery revenues, and year. Data were collected for a five-year period before and after Louisiana began a lottery. Linear multiple regression models with a single quantitative dependent variable were used to test the empirical relationship between the independent variables and teachers' salaries.

The study failed to reject hypothesis one. Louisiana lottery revenues did not affect teachers' salaries among elementary and secondary teachers. In contrast, empirical findings rejected the second hypothesis. No significant difference existed in university teachers' salaries before and after Louisiana adopted the lottery. The rejection of the null may be attributable to model misspecification.

Education and experience were positively correlated with salaries in both models. An added dimension in university teachers' salaries was the rank of the teacher. As expected, full professors earned more than instructors, assistant professors, or associate professors. Administrators earned a premium over all other ranks.

Another notable finding was support for previous research (Ransom, 1993; Oi, 1962) that university employment violates basic wage theory. While overall experience was positively correlated with salary, tenure at a particular university reduced salaries.