Across the United States, lottery tickets are sold for billions of dollars each year. Most people play to have fun or believe they have a shot at the American Dream. The prizes are not a lot, however, and the odds of winning are very low. Lottery critics are right that state-run games should not be seen as gambling, but their objections to the games’ reliance on chance are often based on more than just the lawful definition of gambling: “an arrangement in which one or more prizes are allocated by means of a process that relies entirely on chance.”
The history of lotteries goes back centuries. It was a common way to distribute land, slaves, and property, both in ancient Israel and Rome. It also helped settle the New World, and it continues to play an important role in modern politics, both in countries with a federal system of government and in those that have a more decentralized structure.
In the modern sense of the term, a lottery is an organized arrangement in which one or more prizes are awarded to participants by drawing lots. The arrangement may be open to all or restricted to certain groups of people, but payment of a consideration (money, work, or goods) is always required. State and local governments may run lotteries for tax reduction, military conscription, commercial promotions in which property is given away by a random selection process, and the selection of jury members. The most familiar, and arguably the most successful, are those that award cash prizes.
The first modern lotteries began in the nineteen-sixties, when growing awareness of all the money to be made in the gambling business collided with a crisis in state funding. As America’s prosperity waned in the late twentieth century—thanks to inflation, population growth, and the cost of the Vietnam War—state budgets got strained, and the prospect of raising taxes or cutting services was unpopular with voters.
State officials hoped that the lottery would fill this gap. They were right that the games generated billions of dollars, but they were also wrong to assume that their popularity was a function of their objective fiscal health. Instead, studies have shown that the lottery’s popularity is strongly correlated to its perceived benefits to a specific public good, such as education.
But it is not just the public good that is promoted by lotteries; their reliance on chance is also a form of social mobility dangling a carrot to low-income people. In fact, research has shown that the majority of lottery players and revenues come from middle-class neighborhoods and that far fewer of them come from high-income or low-income areas.