The Lottery Isn’t All It’s Cracked Up To Be

Lottery is a form of gambling wherein tickets are sold and prize money awarded by drawing lots. People have been using lotteries for thousands of years, with the first documented ones appearing in Europe in the 15th century (see below). They were often used as party games during Roman Saturnalia festivities, as a method of divination (Nero was a huge fan), and even as an alternative to taxation.

The lottery was widely adopted in the United States after World War II, when many states began experimenting with it as a way to fund a variety of public services without raising especially onerous taxes on working and middle class families. The name of the game is derived from the Dutch word lot, which means “fate” or “luck.” Early lotteries were sometimes accompanied by events such as fairs, carnivals, or auctions, but the modern system of distributing and selling tickets for state-sponsored games is based entirely on chance and is essentially a form of betting.

Defenders of the lottery argue that its players aren’t aware or don’t understand how unlikely it is to win, and that they’re happy to spend their money on a chance at life-changing sums. But this argument doesn’t hold up when you look at lottery sales trends. The number of tickets sold increases as incomes drop and unemployment and poverty rates rise, and the marketing campaigns are heavily concentrated in neighborhoods that are disproportionately poor, black, or Hispanic.

It’s also not clear that the poor really don’t care about or appreciate the odds of winning. In fact, lottery advocates admit that the jackpots of mega-promotional lotteries are a big part of what drives sales; they need to be huge in order to generate enough buzz to draw people’s attention from other sources of entertainment. Hence, the big-money prize pools get larger and more attention-grabbing over time.

In addition, lottery officials aren’t above availing themselves of the psychology of addiction. Everything about their ad campaigns, the design of lottery tickets, and the math behind them is designed to keep players coming back for more. It’s not that different from how tobacco or video-game makers keep their customers hooked.

But the biggest problem is that the vast majority of lottery revenue comes from people in the 21st through 60th percentiles of the income distribution, who aren’t exactly in need of another source of discretionary spending. This is regressive, and it sends the message that the lottery is good because it benefits people in need, not because it’s an effective way to raise revenue. It’s a regressive message that we should think twice about.