Governments and the Lottery

A lottery is a game where people purchase tickets for a chance to win a prize. The money raised by these games can range from small amounts to a large amount of cash. Governments often run lotteries to raise money. In this article we’ll look at the history of lotteries, how they work and why governments are involved in them.

Cohen describes how in the nineteen sixties, the growing awareness of all the money to be made by state gambling operations collided with a financial crisis for many states. With populations on the rise and a growing social safety net, balancing budgets became more difficult. Many politicians, unable to impose new taxes without risking punishment at the polls, turned to the lottery as a way to bring in revenue seemingly out of nowhere.

Lottery revenues, it was claimed, would pay for a single line item in the state budget, typically education but sometimes elder care or public parks or aid to veterans. The claim was that since the poorest citizens tended to play the lottery anyway, allowing them to gamble with state funds would not only make those people better off, but it would also help the rest of the populace.

As the author points out, this argument is not only dubious, but it also ignores the fact that the wealthy, who have a higher chance of winning the jackpot, buy far fewer tickets and, on average, spend one percent of their income on them. In addition, as the renowned mathematician Stefan Mandel once demonstrated, there is no “lucky” set of numbers that are more likely to be drawn than others.