Should State Governments Be Running a Lottery As a Business?

Lottery is a popular form of gambling that can be found in nearly every state. Many people enjoy playing it, and the revenue generated for state budgets helps make it a mainstay of society. However, critics point to the prevalence of problem gamblers and the regressive impact on lower-income communities, among other issues. They also question whether state governments should be running a lottery as a business, with a clear goal of increasing revenues, or as a public service.

A classic example of how blind acceptance of tradition can lead to evil is the story by Shirley Jackson “The Lottery,” in which a group of ordinary village folk holds a lottery each year that ends in ritual murder. At first, the villagers appear harmless and even quaint, with Old Man Warner leading the proceedings and children gathering stones in the town square. As the lottery begins, they all turn their attention to a box in which are placed slips of paper, and everyone is expected to participate. Even the victim’s family members and friends join in the persecuting fervor, and the fact that she was killed by the wrong number is irrelevant.

The practice of making decisions or determining fates by casting lots has a long record in human history, including several instances in the Bible. However, public lotteries in which people competed for money or property began much more recently. They became popular in the early modern era, and they were used for funding major projects such as the construction of the British Museum and the repair of bridges.

When state governments introduce lotteries, they usually legislate a monopoly for themselves; establish a government agency or a public corporation to run the lottery (as opposed to licensing a private firm in exchange for a share of the profits); begin with a modest number of relatively simple games; and, as revenues increase, progressively expand the lottery’s size and complexity. This expansion typically occurs through adding new games and more aggressive promotion, often with the help of television advertisements.

As a result, lottery advertising necessarily promotes the idea that anyone can win — even those without substantial wealth or connections — and that winning is as easy as marking a number on a playslip. The vast majority of the prizes are cash, and the amount of prize money varies from drawing to drawing. The amount of prize money also depends on the number of participants in each drawing, with the odds of winning a larger sum being lower for small draws and higher for draws that occur more frequently.

A key reason for the popularity of lotteries is their ability to appeal to the public’s desire to achieve the dream of a quick fortune. This explains why the percentage of lottery players who play regularly rises dramatically during times of economic stress, when state governments are faced with raising taxes or cutting public programs. Yet studies have shown that a state’s actual fiscal condition has little to do with its lottery approval ratings, and the popularity of lotteries tends to be more correlated to their perceived benefit to society.