The Lottery As a Major Source of State Revenue


In an era where many people are desperate for money, the lottery is popular because it offers hope of winning a big prize quickly. But the lottery also promotes gambling as a solution to life’s problems, which is why it should be carefully scrutinized. In addition, the way it’s run—by businesses that are seeking to maximize revenues—as a major source of state revenue can have unintended consequences, especially for poor people and problem gamblers.

Lotteries were widely used in the eighteenth and nineteenth centuries, when America’s banking and taxation systems were still in their infancy and public projects needed quick funding. They helped build roads, jails, and hospitals as well as colleges and universities. And famous American leaders like thomas jefferson and benjamin franklin used them, with Jefferson holding a lottery to retire his debts and Franklin using it to raise money to buy cannons for Philadelphia.

Since the 1970s, the lottery has become a major source of state revenue, generating more than $42 billion in 2002. Its popularity has grown, resulting in aggressive promotion and the use of a variety of games and strategies to increase sales. In the process, state lotteries have raised serious moral questions. Some critics see them as a dishonest, unethical form of taxation, while others claim they prey on the illusory hopes of the poor, thereby skirting the need to increase taxes on those who can afford it.

The word lottery comes from the Dutch noun lot, meaning fate or destiny, and is a calque on Middle French loterie, which is probably a calque on Old French lotere, “action of drawing lots” (the Oxford English Dictionary). It was in fact a very common practice in the medieval and early modern world to draw lots for property, including church lands. The modern state-run lottery originated in New Hampshire in 1964, inspired by the success of a privately operated lottery in the state of Massachusetts.

In almost every state that now has a lottery, it is legal for people to play for a chance to win a large sum of money. Most have a single large prize, though some have multiple smaller prizes. The value of the prize is generally a function of how many tickets are sold and how much the entrants spend. Prizes are usually paid in cash, although some states award goods and services such as sports teams or vacations.

When choosing numbers, players should avoid numbers that cluster together in groups or that end with the same digit. Studies show that such numbers are less likely to appear in a drawing than other combinations. In addition, they should buy more tickets to increase their chances of winning. However, a recent experiment in Australia found that buying more tickets does not increase your odds of winning by much.