A lottery is a game of chance in which participants purchase chances to win prizes. In the United States, state-run lotteries are a legalized form of gambling and provide a significant source of income for state governments. Currently, forty-four states and the District of Columbia have lotteries. Prizes range from cash to goods and services, including free public services like schools, roads, and parks. Lotteries are popular, generating billions of dollars in revenue annually for public goods. In 2003, approximately 186,000 retailers sold tickets nationwide. These include convenience stores, drugstores, grocery stores, nonprofit organizations (churches and fraternal societies), service stations, restaurants, bars, bowling alleys, and newsstands. The word “lottery” derives from the Latin loterium, which refers to drawing lots to determine ownership or other rights, and is derived from the Old French verb loter, meaning “to throw”. Making decisions and determining fates by casting lots has a long record in human history. In the Bible, the Lord instructs Moses to distribute property by lot. In ancient Rome, emperors gave away valuable items such as slaves and properties by lottery to their guests during Saturnalian parties. In modern times, lotteries have been used for military conscription, commercial promotions in which property is given away, and charitable distributions of items and services.
While many people enjoy the thrill of winning the lottery, most understand that their odds of success are extremely long. Yet, despite this, they buy tickets, often for large sums of money. They do this because, despite the obvious risks, they feel that somebody must win. This feeling, a form of hope, is an attractive and powerful emotion. The lottery appeals to a basic human desire for the impossible, and it works.
Governments promote the lottery as a source of painless taxes. In the immediate post-World War II period, politicians saw the lottery as a way to expand the array of public services without imposing onerous taxes on the middle class and working class. This arrangement worked well until the costs of the Vietnam War drove inflation and public expectations higher, and voters demanded more from their states.
In the 1980s, several states that did not have lotteries started them, and others expanded their operations. By 2004, all forty-four states had lotteries.
The principal argument for the lottery is that players voluntarily spend their own money on a ticket, and thus they are not being taxed. This is a valid point, but it does not fully account for the fact that lotteries are a form of gambling and that the gamblers who play them may be spending a large portion of their incomes. In addition, because the lottery is a gambling enterprise and because the advertiser’s objective is to maximize revenues, its advertising necessarily focuses on persuading gamblers to spend more money on their tickets. This raises the question whether a government should be in the business of promoting gambling, especially when its primary function is to generate revenue for state governments.