Lottery is a competition based on chance, in which numbered tickets are sold and prizes are awarded to the holders of the numbers drawn at random. It is a form of gambling, and also a means of raising money for public or charitable purposes.
Historically, the concept of a lottery was an important part of European culture, and public lotteries were widely used throughout Europe during the 17th and 18th centuries to finance construction projects and other public works projects. Private lotteries were also common, with prizes ranging from pelts and livestock to valuable merchandise such as dinnerware.
In the United States, state-sponsored lotteries began in the Northeast in the early post-World War II period, when states were expanding their array of social safety net services and needed extra revenue. The principal argument used to promote the adoption of a state lottery was that it could provide “painless revenue”: citizens would voluntarily spend their money in exchange for an opportunity to win a prize, thereby freeing up tax dollars for other purposes.
Lotteries are now a feature of American life, with 37 states participating in them. In addition to the monetary prizes, many states use their lottery proceeds for educational programs and other public goods and services. However, there are serious questions about whether running a lottery is an appropriate function for a government, particularly one with a mission to maximize revenues. Lotteries promote a type of gambling that can have negative consequences for poor people and problem gamblers, and they raise the question of how much the state should be in the business of encouraging irrational behavior.
While the exact percentage of lottery revenue that goes to the prize pot varies by state, most allocate a substantial share to administrative and vendor costs as well as to projects that they designate. In general, lower-income communities tend to play the lottery at significantly higher rates than other populations. For example, the poor play the Illinois Mega Millions lottery in disproportionately higher numbers than whites and blacks.
Moreover, when people buy lottery tickets, they are essentially paying a fee to be exposed to a message that says — implicitly, but strongly — to win big, you have to be lucky. That’s not a message that most people are going to take lightly, especially when they’re spending $50 or $100 per week. And that’s why it surprises me to talk to people who have been playing the lottery for years and are still buying tickets — even though they know the odds are against them. It’s a peculiar and irrational habit that persists, even among committed players. It can feel like an ugly underbelly of society that just won’t go away. A version of this article first appeared in the April 2019 issue of Reader’s Digest. Subscribe to the magazine here.